Insolvency service to accept debtor applications from next month

The Insolvency Service of Ireland (ISI) will start accepting applications from people in debt by the middle of next month, its director has said.

Lorcan O’Conor said the service should be in a position to start taking applications in a few weeks’ time provided other matters are sorted out by then.

The service was set up by the Government earlier this year to provide pathways for those in debt to return to solvency.

Applicants who want to avail of the service will have to do so through personal insolvency practitioners (Pips) and approved intermediaries. Therefore, the service will have to start authorising Pips and intermediaries by the end of July to have a "critical mass" in place by mid-August, Mr O'Connor said.

Mortgage debts
Intermediaries will deal with people applying for debt-relief notices who have debts of up to €20,000, and Pips will deal with applicants for debt settlement arrangements and personal insolvency arrangements involving people with higher unsecured debts and mortgage debts of up to €3 million.

The ISI has so far received more than 100 applications from people looking to become intermediaries and practitioners, Mr O'Connor told members of the Oireachtas Finance, Public Expenditure and Reform Committee.

A special IT system developed for the service also needs to be handed over by the Department of Justice. Mr O’Connor said any delay in this handover would have a “knock-on effect”, but he added that the department had given an “absolute assurance” that the transfer would take place by the end of this week.

Finally, Mr O’Connor said, the remaining provisions in the personal insolvency legislation must be commenced along with the passing and commencement of amendments in the Courts Bill.