THE number of financially-stretched people applying for a State-sanctioned debt deals has doubled. But the actual number of deals put in place is down.
New figures from the Insolvency Service of Ireland show that almost 900 people applied to put a formal arrangement in place with their lenders.
The figures were for the three months to the end of September. This was up 102pc on the same three months last year. But the number of heavily-indebted people who secured a formal deal from their banks and other lenders fell in the three months to September, when compared with the same quarter last year.
Just 180 people had a deal known personal insolvency arrangement (PIA) approved in the July to September period. This was down by five PIAs in the same quarter last year.
A PIA allows a person to reduce what they are paying, and return to solvency while staying in their home. There was also a fall in the number of bankruptcies of 26pc to just 61 the third quarter.
In the year so far, a total to 345 people were declared bankrupt, compared with 479 for full-year 2015. This is despite the term for bankruptcy being reduced recently to one year.
Insolvency Service director Lorcan O’Connor blamed the summer recess in the bankruptcy courts for the fall.
Large numbers of people are still struggling to pay their mortgages. The number of people two years or more in arrears on their mortgages was close to 35,000 in June, down slightly from the previous quarter, separate Central Bank figures show Those in arrears for more than two years risk losing their homes.
Mr O’Connor said: “This quarter saw continued growth in new applications with protective certificates and approved arrangements at similar levels to last quarter.
“When compared to the same period last year, there is significant growth in all categories.”
So far, some 4,000 people have gone through different processes overseen by the Insolvency Service to return to solvency.
Earlier this month the Government launched its ‘Abhaile’ plan to tackle the problem of mortgage arrears. This service will provide free, independent expert advice and support on financial and legal issues through the Money Advice and Budgeting Service (MABS), working with the Insolvency Service of Ireland, the Legal Aid Board and the professional accountancy bodies. Mr O’Connor said this new initiative is “expected to drive further growth in the coming months”.
Article Source: http://tinyurl.com/kbwqb42
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