March 28, 2017

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Do you need Debt help?

Can you cope with the stress of debt?

Debtors frozen with panic shouldn’t feel alone, after a study revealed 43% of those in serious debt were too scared to take action.

The UK study cited fear of family’s reaction as the number one concern about revealing financial problems; causing those in trouble to wait longer before taking action and often adding to their debt burden.

Nearly a quarter of people in debt take at least a year to deal with it and debilitating worry is often a side-effect. 40% polled believed they were unable to move on with their life because of their debt problems.

“The main concern is that while the fear factor is preventing people from talking about debt and seeking help, their debts continue to mount.”

By seeking advice early, they can stop the problem from escalating, and prevent the stress caused by serious debt taking over their lives. People get stuck in a vicious circle of fear and inaction, which in reality only makes the problem bigger.

The new “Abhaile “Scheme offers assistance to people who find it difficult to start the process of debt negotiation and are in mortgage arrears on their family home.

The services offered by Personal Insolvency Practitioners are comprehensive – covering everything from family home debt, business debts, Credit Union debts and all other forms of debts including revenue debt. By working with a debt specialist, debtors can get debt written off, so they can move on with their lives.

The key according to Eugene McDarby Managing Director of is to not ignore the problem

“As a nation we need to get over the idea that being in debt is shameful and something we should hide”.

Guest Blog

Eugen McDarby

UHY Insolvency

Not too long ago, the concept of debt negotiation, insolvency and bankruptcy did not really exist in Ireland; except in extreme circumstances, and usually where a business had failed. Our home repossessions and insolvency rates were virtually non – existent.

However, we now know that under all this exuberance of wealth was a society that borrowed in excess, to fund its lifestyle.

In Ireland, all forms of debt have risen substantially.

The Facts

In 1995 Ireland was ranked 17th in the world table of household debt Vs disposable income.  In 2008 Ireland was ranked 4th.  This is a 267% increase. (Source Goodbody) Household debt is typically home loans, credit cards, car loans, credit union loans and other personal loans.

People have changed their spending patterns and tightened belts, but this is having a minor effect on their overall net income.

In the past we borrowed our way out of debt.  With rising property prices, one could easily sell the property, pay off the debt and still make a profit.

This solution no longer exists.  Many who bought property in the last 10 years are still in negative equity, and banks have tightened credit, so facilities are not available.

One point is certain in the current environment, “Debt is a matter of fact, assets are a matter of opinion”

So what happens when.

Made Redundant


Huge drop in income

Cashflow problems

Reduction in rent

You need to know the extent of the debt problem. Mortgage, car loan, credit card, credit union, business, revenue etc.

Never mind the financial consequence, the emotional and psychological impact will be detrimental and, in extreme cases, suicides have happened.

The lender/creditor response is not enough!

The banks and building societies, overall, have been mildly responsive to clients who genuinely are financially stretched. There are still over 80,000 in arrears on their family home mortgages in 2016, and many lenders are now selling their bad books of debt to so called Vulture Funds.

It is important to know your rights and all institutions must comply with Central Bank codes in relation to mortgage debt specifically on family home mortgages.

Communication between you the bank and other creditors is very important. You need to be very upfront about your predicament and inform the bank at the earliest possible point.

The bank may base their solution on a “can’t pay, won’t pay” principle.

This means that if the client just cannot pay, they will, in all circumstances, be sympathetic.  If they won’t pay, the client may end up in court.

Typical Debt management and Insolvency advice would be to:

  • Prioritise your debt
  • Separate debt between secured eg Mortgage and unsecured eg Credit card.
  • Prioritise household expenditure.
  • Consider lifestyle and spending patterns
  • Get some legal advice on your debts
  • Consider your Insolvency options

The main flaw in the code is that it only applies to lending activities on principal private residence, so investment properties and unsecured debt are not covered.

Most people have all forms of debt, so the respite from the banks on private homes is generally not enough and negotiation of all the debt is required.

The bottom line with your creditors is that they still want their money back and may well only give temporary respite, depending on the circumstances.

“My advice is to get your life back and get in control of your finances”.