Insolvency bill offers lifeline

The Personal Insolvency Bill published this week will give a vital lifeline to distressed mortgage holders and those overwhelmed by personal debts, Fine Gael TD, John Paul Phelan, says.

The Personal Insolvency Bill published this week will give a vital lifeline to distressed mortgage holders and those overwhelmed by personal debts, Fine Gael TD, John Paul Phelan, says.

The Heads of the Bill was published by Ministers Alan Shatter and Michael Noonan this week, and it is hoped it can be published in its legislative form by the end of April.

“The key element of this proposed new legislation is that it will allow people to remain in their own homes while getting on top of their financial affairs. People right across Kilkenny have been desperately in need of for some form of help to allow them to get on top of a growing mountain of debt that for many average homeowners has gotten out of control. Trying to honour large mortgage repayments on reduced incomes mean these people are often left with next to nothing once the bills are paid.

“The Government wants to help these people and others like them, who are unable to cope with their debts. Under the provisions of the Personal Insolvency Bill, a number of arrangements will be made available, whereby a portion of personal or mortgage debt may be written off, as part of a repayment plan. Debt Relief Certificates will help out people with smaller debts, of less than €20,000, while Debt Settlement Arrangements can be reached for larger mortgage loans.

“This means that the Bill will help not only those in mortgage arrears, but also those who are utterly overwhelmed by credit card bills, car loans and overdrafts. The final element of the legislation is the reformed bankruptcy arrangements, which will reduce the period of time that a person will be considered bankrupt from 12 to 3 years.

“A Personal Insolvency Service will be set up to administer the new regime, with insolvency trustees appointed to liaise with creditors on behalf those in debt. This will hopefully help to alleviate some of the stress associated with trying to reach agreement with banks and other creditors. The Government has said it hopes to have the full legislation published by the end of April, and I hope the Service can be set up as soon as possible after that,” Deputy Phelan said.