THE INSOLVENCY SERVICE of Ireland (ISI) will open its doors this morning to allow thousands of struggling borrowers to start afresh.
The statutory body was established in March this year but says it will be in a position to accept applications from this morning.
About 80 staff members, based at offices in Dublin 8, are expecting to be busy.
According to a report in yesterday’s Sunday Independent, up to 4,500 people have already contacted the ISI and a flood of applications have been predicted.
Ross Maguire, a barrister and member of New Beginnings (a group advocating for distressed borrowers), believes the service will work but it will take time.
He told TheJournal.ie that the number of people getting in contact with the ISE will “swell” in the coming months.
“People will meet with Personal Insolvency Practitioners (PIPs) but that is not a commitment,” he noted. “It is just to explain the procedures and let people know what they are facing.”
On entering an insolvency arrangement, people will be given the protection of the courts from their creditors for a period of three months. During that time, PIPs will work on proposals that should be deemed satisfactory to both the borrower and the creditor.
“In the UK, over 94 per cent of these arrangements are accepted even though they involve write-down,” he said.
A note of advice? “People may be scare about it but they should take their time and look at it. Meet with real PIPs and get a sense of what is involved – both the good bits and the pitfalls. Don’t just read the newspapers with conflicting viewpoints from commentators.”
There will be a mix of homeowners, small business owners and ‘amateur landlords’ expected at the ISI doors over the coming six months.
Maguire says that there are probably 250,000 people in Ireland insolvent at the moment.
He says that many are insolvent because they purchased family homes at inflated prices and after five years of recession, those same people have seen their wages reduced dramatically – and in some cases eliminated.
“They are further burdened by increased taxes and charges levied in the course of austerity measures adopted by government.”
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