A Debt Settlement Arrangement (DSA) is something we might be hearing a lot more about in Ireland soon. New Irish Insolvency laws are being introduced in 2013 to try and help people sort out debt problems without resorting to legal action.
Debt Settlement Arrangements will allow an agreement between you and your creditors (people you owe money to) to pay all or part of your debts off over a set period.
A DSA only applies to unsecured debts such as credit card, personal loans, overdrafts, retail, store catalogues, etc which amount to more than €20,000.
For debts below €20000 you need to look into a Debt Relief Notice .
The first stage is to find a personal insolvency practitioner (PIP) , who will examine your ircumstances, complete a financial statement of affairs and apply to the Insolvency Service for a Protective Certificate in respect of preparation of a DSA.
If granted – the Protective Certificate would allow you a 30 days during which creditors may not take action against you.
The next step is for the personal insolvency practitioner to forward a DSA to your creditors for their agreement. The proposal would set out the amounts to be repaid by you over a five year period and any special conditions.
If the repayment proposal is accepted by your creditors (by a vote of 65% in value of qualifying creditors), the Insolvency Service would provide formal registration of the Debt Settlement Arrangement
At the satisfactory conclusion of the DSA after 5 years, all of your debts covered by it would be discharged in full. You will not be able to apply for another DSA within a ten-year period.
A DSA will likely be subject to annual review by the PIP to reflect any changes in your fiinancial circumstances. It may be varied or terminated and you could still be subject to an application for adjudication in bankruptcy on the ending, termination or failure of the DSA.
There are grounds for challenge by creditors to a DSA proposal and there is a role for the courts on application to have a DSA annulled.