Stagg Welcomes Personal Insolvency Proposals
Issued : Friday 3 February, 2012
Areas : Kildare North
Deputy Emmet Stagg has welcomed the publication of the Government of the heads of the Personal Insolvency Bill.
This bill he said is about giving the 10’s of thousands of people with crippling debt a fair deal and a fresh start.
It is about people who can’t pay not those who won’t pay.
The legislation proposed is complex and far reaching and the area dealing with unsecured personal debt has no legislative equivalent in the democratic world.
There are four essential legs to this package.
1. Dealing with bankruptcy which will be reduced from the present 12 years to 3 years.
2. Personal secured debt which is mostly in the form of unaffordable mortgages and with large amounts of negative equity.
3. Personal unsecured debt over €20,000 that is no longer possible for the borrower to meet repayments.
4. Personal unsecured debt below €20,000 that is no longer possible for the borrower to meet repayments.
A system will be put in place with the full authority of legislation for Insolvency Trustees who will assist the borrower to reach a sustainable agreement with the lender. This in many instances will mean a write off of part of the Debts of the borrower.
This gives certainty to the lender about the Government’s direction and it is now in their interest to start realistic talks with their borrowers to reach voluntary and realistic solutions rather than face losing their security through borrowers bankruptcy down the road.
These proposals will lift the crippling fear from those burdened with un payable debt and from those who are struggling to pay and fearful of the future. It will give them a fresh start and an opportunity to return again to economic activity and a fruitful role in society. The proposals should also be viewed in tandem with the action taken by the Government to introduce a scheme late last year for mortgage holders who could not pay to switch their status to tenants and thereby secure their family home. This scheme continues on a pilot basis.
