# Personal Insolvency Bill: Can one apply now?



## marfsmal (1 Oct 2012)

Hi,
Just wondering about the new Personal Insolvency Bill. Is it possible to apply now or is it still undergoing review?


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## Brendan Burgess (1 Oct 2012)

The Personal Insolvency Bill is not in force yet.

However, one of its features is that creditors and debtors should seek to reach an agreement themselves first. So there is no harm in you approaching your creditors with some proposal. They are less likely to accept it now . The culture may change after the bill comes into force.

Brendan


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## marfsmal (1 Oct 2012)

Thanks Brendan. My main problem is that my debts are with 3 different banks. I have just about made repayments by putting all I have into meeting minimum repayments and the most basic of living costs.

I asked my bank for a loan to consolidate all three of my debts, it's well under 10k in all. Like I said, I have never defaulted on a debt in my life. They would not give me this consolidation loan, which in truth, is my only way to get on top of the debt and back on top of my life. What choice do I have now?

Sorry I don't know what you mean by how they are less likely to accept a proposal now?

Also, if I was to stop paying back my debts now, and were the banks to sell my debt to debt collectors before the Bill comes into force, where would that leave me re. the Bill?


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## Kerrigan (1 Oct 2012)

Hi Brendan, some have began accepting agreements on unsecured debt already.  It is sometimes best to have a third party to represent your case in writing on your behalf i.e an accountant, solicitor, MABS or DM company.  It puts some weight behind the proposal.


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## marfsmal (1 Oct 2012)

What kind of agreements can you make with the banks? I've asked them before and they wouldn't accept a lower monthly repayment even, they just said they would give me one month's break from paying. I was hoping to go it along without Mabs and I was hoping to pay it all back but they have made it as hard as possible.

Sorry to ask again but were the banks to sell my debt on before the Bill is actually passed, where would that leave me? I'm worried I wouldn't be covered by the Bill or would the debt collectors be considered as a creditor in the same way the banks would be, etc.?


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## Kerrigan (1 Oct 2012)

marfsmal said:


> Also, if I was to stop paying back my debts now, and were the banks to sell my debt to debt collectors before the Bill comes into force, where would that leave me re. the Bill?



Even if your debts are passed onto a debt collector, you will still have no problems re the bill.  Debt collection companies are sometimes more approachable than your creditor.  Always be realistic with what you can afford to pay back.


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## marfsmal (1 Oct 2012)

Kerrigan said:


> Even if your debts are passed onto a debt collector, you will still have no problems re the bill.  Debt collection companies are sometimes more approachable than your creditor.  Always be realistic with what you can afford to pay back.



Thanks Kerrigan, good to know that re. the debt collectors. They should have set up a system long ago whereby a person was allowed to consolidate their debts into one loan and given reasonable time to pay it back at a reasonable repayment amount. As part of that agreement they could have cut that person off from making new applications for credit. It would have been a terrific solution. They would have maximized their return and distributed the monies to the banks concerned.

Re. the debt collectors though. It's awful. You will end up paying back almost the same amount anyway but have to deal with a black rating on your credit rating. All you save is on the interest not continuing to build up. Is it worth that hassle? It would be easier to get in touch with Mabs than deal with three separate debt collection agencies, who may, or may not, show up at my family home which has been my permanent address for all banking correspondance.


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## Kerrigan (1 Oct 2012)

marfsmal said:


> What kind of agreements can you make with the banks? I've asked them before and they wouldn't accept a lower monthly repayment even, they just said they would give me one month's break from paying. I was hoping to go it along without Mabs and I was hoping to pay it all back but they have made it as hard as possible.
> 
> Sorry to ask again but were the banks to sell my debt on before the Bill is actually passed, where would that leave me? I'm worried I wouldn't be covered by the Bill or would the debt collectors be considered as a creditor in the same way the banks would be, etc.?



It can be quite stressful to deal with the banks directly so go to MABS and seek as much advise from them as you can.  They will draw up an income and expenditure form for you.  This form should be sent to all of your creditors along with a letter explaining that you cannot repay what they are seeking .  Sorry for being so blunt but if your creditors don't like it they can go and take a running jump!  You cannot get blood from a stone.  If you can only afford to pay €10.00 to each creditor per month then so be it.  Whatever you can afford to pay then just keep paying it.  They will of course keep putting interest on top of the debt but eventually they'll soon realise you just don't have it to pay out.   

Don't be afraid of the debt collectors.  They generally accept proposals that is put in front of them.


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## Kerrigan (1 Oct 2012)

marfsmal said:


> They should have set up a system long ago whereby a person was allowed to consolidate their debts into one loan and given reasonable time to pay it back at a reasonable repayment amount. As part of that agreement they could have cut that person off from making new applications for credit. It would have been a terrific solution. They would have maximized their return and distributed the monies to the banks concerned.



Absolutely, but in this country our banks don't do common sense.  If you go down the debt management route, there are quite a few debt management experts on this forum, Steve Thatcher and Frostie etc, you should drop either of them a line. 

With debt management they can consolidate your debt repayments into one monthly repayment.


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## marfsmal (1 Oct 2012)

Yeah I  have no qualms considering letting the banks take a running jump. I found the guy in collections that I rang that one time to be ignorant and insulting, telling me I was begging peter to pay paul. This was because they had reduced my overdraft from 700 to 500 without telling me (the 700 was the unauthorized limit which they had let me use for last couple of years but said they had taken away because my income had changed in past 6 months.) Also this rudeness was the more horrible because this was actually my first time to actually ring to ask for an adjustment/reprieve of some sort. I wasn't asking for a writedown or deal, just some space, so I got the one month.


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## Kerrigan (1 Oct 2012)

The bailed out Irish institutions haven't a clue what they are at.  They have become mere debt collecting centers, full of snotty nosed, living at home with mammy scouts with their memorised text book jargon.  I have seen grown adults crying getting off phones from one Irish credit card provider.  

I have sent you a pm.


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## Bronte (1 Oct 2012)

Can you post up each debt, the interest rate and the minimum repayments you are making, it may be better to pay off one rather than making minimum repayments.  Until you post figures it will be impossible to decide.  

You do realise that your situation is exactly what Mabs is there for.  They will negotiate a repayment plan, and presumable zero more interest and penalties so that is where you should be starting.


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## Bronte (1 Oct 2012)

Kerrigan said:


> If you go down the debt management route, there are quite a few debt management experts on this forum, Steve Thatcher and Frostie etc, you should drop either of them a line.
> 
> With debt management they can consolidate your debt repayments into one monthly repayment.


 
The OP has debt of 10K.  Steve Thatcher is a UK based bankruptcy expert, and I think Frostie is an Irish based debt management company.  Both of these need income and someone with 10K debt wouldn't seem to me to be someone who can afford that.  

In any case when one has a free service with Mabs why would one pay more.


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## Kerrigan (1 Oct 2012)

Hi Bronte, yes, obviously go with MABS first.  Of course some debtors are unable to wait on MABS, after all they are inundated with people seeking their help and some may have no other option but to go with the DM because of long waiting lists.  

As I have mentioned on this forum before; I will put odds on that MABS will not have a large slice of the PI trustees but will instead be the DM companies.  Of course only time will tell.


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## marfsmal (4 Oct 2012)

Bronte said:


> The OP has debt of 10K.  Steve Thatcher is a UK based bankruptcy expert, and I think Frostie is an Irish based debt management company.  Both of these need income and someone with 10K debt wouldn't seem to me to be someone who can afford that.
> 
> In any case when one has a free service with Mabs why would one pay more.



Sorry Bronte, I have to correct you there. I said debts of *well under* 10k. So think in terms of 5-10k range and I will never borrow again, not even for a house.


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