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Ireland’s First Debt Settlement Arrangement Agreed

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Ireland’s First Debt Settlement Arrangement Agreed

The very first debt settlement arrangement was approved by creditors in Dublin on the 23rd November 2013.

 

A debt settlement arrangement is a formal agreement which helps an insolvent person deal with unaffordable debt. Under this type of arrangement a percentage of the debt is paid for 5 years and the remaining debt is written off.

 

In some cases up to 70% of the debt can be written off and unsecured debts (credit card, loans or catalogues) are included in a debt settlement arrangement.

 

It was reported that the first debt settlement arrangement involved a 70% write down of debt and the debtor who was based in Donegal had unsecured debt of six figures and was unable to pay the debt when their business failed. It is understood three of Ireland’s main banks were among six creditors involved and that the collapse of the business left the individual with a residual debt they could not pay.

 

A debt settlement arrangement is one of the three new debt solutions introduced under the Personal Insolvency Act 2012. It is designed for individuals who have no prospect of paying off all their unsecured debts in the next five years.

 

This debt settlement arrangement will see 30% of the debt paid off over the next five years and the rest of the debt believed to be 70% will be written off.

 

A Personal Insolvency Practitioner secured the deal for the debtor. The Personal Insolvency Practitioner worked on behalf of the debtor for a few months to try and agree the right deal for the debtor and negotiated a debt write down deal of 70%.

 

The Personal Insolvency Practitioner applied for a protective certificate while negotiating with the creditors as this gives the debtor 70 days protection from legal action.

 

Under the new Personal Insolvency Act, when the protective certificate is issued the Personal Insolvency Practitioner has up to 70 days to work out a deal on behalf of the debtor.

 

This debt settlement arrangement was agreed a month after the protective certificate was issued by Monaghan District Court.

 

The debt settlement arrangement agreed does not involve mortgage debt. If the debtor was struggling with mortgage debt also then they could have applied for a Personal Insolvency Arrangement instead with the help of the Personal Insolvency Practitioner.

 

A Personal Insolvency Arrangement is a formal arrangement which helps an insolvent person deal with unaffordable secured and unsecured debt.  Under this type of arrangement a percentage of the debt is paid for usually 6-7 years and the remaining debt is written off. In some cases up to 70% of the debt can be written off and secured debt (mortgages, secured loans) and unsecured debts (credit card, loans or catalogues) can be included in a Personal Insolvency Arrangement.

 

The 23rd of November 2013 marks a very important day in Irish history as this land mark case shows anyone burdened with unaffordable debt that there are now solutions available to help you deal with debt and unaffordable debt can be written off.

 

These new debt settlement solutions reduce debt repayments to affordable amounts/writes off debt that cannot you afford to pay and creditors are agreeing to these arrangements with the help of a Personal Insolvency Practitioner.

 

If you are struggling to pay your credit card debt, loans or mortgage then contact us today on 01 4434125 and find out for free if you qualify for up to 70% debt write off.

 

R.McGonnell 11th July 2016

 

 

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