Key Post Discharged from bankruptcy-My experience.

Catastrophe

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It is now two months since my wife and I were discharged from bankruptcy and having gone through the last eight years of trying to avoid registered letters, solicitors demands and numerous 'phone calls from all and sundry, it was really pleasant to have a Christmas without worrying about what the new year will bring.

After my wife took ill over eight years ago and had to leave her job, we were left, as per our pre- bankruptcy financial statement with secured debts of €200k and unsecured debt of approx. €50k. To cut a long story short we tried everything, payment holidays, readjusting payment rates & frequency, interest only, borrowing from family, making deals with various solicitors and then breaking them almost immediately when a different demand came in. We also sought assistance from different people and bodies: Mabs, Citizens Advice, Local Authorities, the Employee Assistance Programme offered by the VHI for those in the Public Service and then finally New Beginnings and the IMHO.

We attended two meetings with New Beginnings and on both occasions we were advised to go bankrupt as we had no excess that we could realistically give to any creditor so as to apply for PIA. We also attended one initial meeting with IMHO and they too advised bankruptcy, the difference with the IMHO however was that they were offering their services for free, in contrast to New Beginnings who were looking for a few thousand euros. We told the IMHO that we could not afford the cost that New Beginnings were seeking and we were told not to worry that we would only be required to pay court and admin costs, which in hindsight amounted to no more than €500 if I can recall correctly.

Willie Penrose TD had just got his Bill through the Dail, however with delays in the Courts Services, our paperwork was delayed and we were finally given a date in early Nov 2015. We queued up in the Four Courts with approx another 80 people and the judge called out both my wife's name followed by mine and we both stood up in turn, acknowledged the court, and the judge told us to meet the rep from the OA office.That was it. In less than ten minutes we were outside the Court having met the OA and telling her we'd prefer to deal by email rather than letter in the future!
Two weeks later we were back in the same Court, the judge acknowledged that we had published the details as required, wished us well, and again in less than 10 minutes we were back out on the Quays.

We knew we had an excess of €140 approx per month in our RLE and we were instructed to set up a standing order for same payable to the ISI. What we did not know, or expect was that the money I had paid into, in my job's Christmas club throughout 2015 would also be confiscated. In tears, in the second week in December, with no other money coming in, my wife rang me at work to say that the ISI wanted the €600.
My wife rang our case worker back in the ISI and explained the situation and in fairness, an agreement was made which left my wife with her money and an agreement from me that I would pay the €600 throughout 2016 along with the PIA.

In early 2016 I got another surprise. With the decrease in the USC in the budget I had got another slight increase in wages and I made the ISI aware and further alterations were made to the PIA which I complied with, however, when I went to claim back my wife's medical expenses from Revenue, I discovered that I was blocked online from making any entries or returns. I made several attempts, rang local offices, rang helplines and no one could help me. I then was put through to the Insolvency Section in Revenue after several weeks and was informed that the ISI had a block on both my wife's and mine tax affairs. My wife's medical expenses were then confiscated by Revenue on behalf of the ISI. I understand, however like my previous experience with the Christmas club, it would have been nice to have known.

From then on until June everything remained static, then I was asked for copies of some recent payslips and my wife informed the ISI that my daughter who was turning 18 was being cut off from the Children's Allowance but was continuing in school. In October the PIA was finished as our circumstances had changed and we were informed that we would be discharged in November.

That was the last we heard from the ISI. In fact, to date we have still received demands from the Bank which we mortgaged with. They did not know we had gone bankrupt. We have sent them copies from of our Court Appearances and told them to get in touch with the ISI, but it appears that one section doesn't know what the other section is doing. Revenue still had our details blocked, however I have finally resolved that issue only this week, so I my wife can claim her expenses, we are still paying a property tax on a house which we vacated over 18 months ago and which we have no intention of ever returning to even if we got the choice.

In conclusion, we are back on an even keel, I can go for promotion this year or do overtime if it arises but most of all the worry and dread is gone. If anyone requires advice or help don't hesitate in asking.
 
I don't understand the medical expenses bit.

If you pay say €100 for a doctor/medicine, you are entitled to tax relief on it I presume. But it's not an income. It's your own money returned to you in the form of tax relief?

Could you tell us your opinion of all the agencies.

I presume you went with the IMHO in the end as they were free.
 
Hi Bronte, we have no medical card and so all costs for my wife's medications are borne by us. During 2015 we paid almost 2k in medical care and normally we claim the 20% back from revenue through the PAYE anytime online system. In Jan 2016, whilst only 3 months into our bankruptcy, I attempted to claim this tax relief back for 2015. As per my initial post, I was blocked from using the PAYE anytime system and to cut a long story short had to enter our medical claim 'manually' by another roundabout way as the Revenue Insolvency Unit had closed off or taken control of our PAYE details.
The €400 approx tax refund was sequestrated.

As for my opinions of the other agencies, I must say that I found all very sympathetic and supportive, however I also found that most of the State agencies have very little knowledge of how insolvency/bankruptcy works.

With regard to local authorities for instance there is no assistance available, eg, as a previous householder one is deemed as making oneself homeless and so no help is forthcoming. The monetary thresholds are also so low less than 30k in my area, that most people who are in any type of job will not qualify. Most of the clerical officers I dealt with knew nothing about insolvency etc.

I found IMHO and New Beginnings both professional and sympathetic. As in my initial post however NB were seeking almost €3k to assist my wife and I go bankrupt.In contrast IMHO guided us through fully, met us on 3 different occasions and attended court with us both times. I cannot thank David Hall and is organisation enough.

I also found the ISI very helpful. Although, there were occasions when they too also appeared confused and answers to our questions would sometimes not initially get answered straight away and it seemed as if they too had to go off and source the answers, in fairness though they always did get back to us and furthermore, as the year progressed the cooperation and interaction was far more fluid.

On one final note however, I was lead to believe that I had to inform my bank that I was after being made bankrupt. This I found out later is only a requirement if the bank you are dealing with has been included in your bankruptcy proceedings. In my case, my mortgage and other dealings were with a different bank and the bank I used for day to day affairs was not included in bankruptcy, and in fact was never even overdrawn! I went in after my court case to request they close my a/c down and open up another and I explained my circumstances to a teller who I knew and who was very confused only to find out after she called various managers and departments that I did not have to embarrass either myself or her by declaring my bankruptcy as they were not a party to our bankruptcy.
 
Thanks for your honest post - do you mind me asking if you had any revenue debt writing off?

The reason why I'm asking is that I'm just about to go through the process and I rely on having a tax clearance cert to work.
 
Hi Catastrophe,

Just wondering - if you were over the RLE's during your first year of bankruptcy, does payment of that amount not continue for the full three year payment term from date of adjudication?

Also - if during those three years, you earn extra income, work overtime etc - does that extra amount need to be handed over to ISI?

----

I ask this as my understanding is that extra income above RLE's during the three years from date of bankruptcy adjudication - needs to be handed over to ISI for creditors.

As such, prior to our bankruptcy - we are going below RLE's for three months and thus avoid payment orders altogether - meaning when we're discharged, we can earn as much as we want and not be obliged to inform anyone about same.. (ISI or creditors)

Bank statements need to be squeaky clean for those three months to show earnings less then RLE limit.
 
Hi, bankruptcy is now only a 1 year sentence. On the day we were adjudged bankrupt we did have a surplus above the RLE which we paid as an IPA for approx 10 months.

Then our circumstances changed and for the last 6 weeks or so our income fell below the RLE threshold and we were dischaged on the first anniversary of our court date.

What you are saying is correct however. If we continued to have a surplus on the anniversary date of our bankruptcy our IPA would be changed to an IPO (Order), and we would have been constrained for a further 3 years.
 
To clarify on your second point, perhaps Im reading you wrong but the important time to be below the RLE is prior to discharge of bankruptcy, I most defnitely would not be doing overtime or extra shifts on entering the process. Everything above the RLE will be taken.
 
Can I ask what was your inter action like with the OA?
Was it in person, via email? Was it the same person or different people? Just an over view of the process would be great.

Thanks
 
No problem. Interaction with the OA was few and far between. As per my initial post , on the day of our court hearing we met a rep from the OA office as we left the court room. She appeared to have our file pn hand and we just verified our name, address and some other basic details.
We heard a few weeks later from our caseworker by phone then. He rang our house and just verified some more info and I think at that stage some recent payslips were requested and another financial statement was filled in. A few weeks later our IPA was sent out and we signed and agreed on same.
There were a few times that we required clarification on fairly personal matters or on what further items could or could not be included etc in RLEs and these questions were promptly answered if not there and then, then normally within 24 hours.
I informed the OA office of my own accord when changes occured in my wages. I sent off the relevant payslips as the change happened as I wanted to be as upfront as possible and not have them coming after me looking for the info.
We knew that in Oct that a material change would be occuring in our RLEs and so in August we phoned our caseworker and sought info on how to approach same.
We received a number of forms, completed same, returned some recent pay slips and that was it.
In early Oct we received an email stating that our IPA would be finished in Oct and that we would be discharged in Nov. And that was that.
We heard nothing for the last six weeks, and in fact we were 'afraid' to even ring in case we drew attention to ourselves even though we had done nothing wrong, but it appeared so abrupt.
In early Dec we both received a letter from the ISI stating that we were discharged in Nov.
We did initially still receive the odd letter from some of our creditors even into Dec and we got onto our caseworker again. We ended up returning photocopies of our discharge letter plus our caseworkers name to all our creditors and since then we have heard nothing from anyone since.
We found the ISI staff that we dealt with to be courteous, sympathetic and a lot more professional and polite than some of the other state agencies with which I have had reason to engage.
 
It's a relief to get an insight into how it works as I will be in the middle of in a couple of months. Having a better understanding of the process makes the decision to move forward a lot easier.
Best of luck to you and your wife for the future and thanks for taking the time to give such a detailed reply.
Gyro
 
Likewise, I wish you well.
In hindsight , it was a very short year for us and the relief in being able to answer 'private' phone calls and not having to avoid the postman is worth it alone.
Good luck.
 
My story is simiar to yours, we didnt have the burden of an illness though. I hope your wife is well.

We are now in the process if rebuilding life after bankruptcy. Our revenue account was frozen aswell paye workers.

Now on our icb report out mortgage is showing in arrears our house we surrendered and went renting. With no scheduled removal on icb report. Have you crossed this bridge yet?
 
Hi, sorry for delay in replying. Like you, we vacated our house prior to bankruptcy. We made the bank aware, we made the OA aware, and to date we are almost 2 years out of that house. Since bankruptcy discharge we again made the bank aware of our discharge and to date there still has been no change.

Prior to your post my wife and I were discussing this very problem and we have now decided that we are going to send registered letters to both the bank and OA and put them on notice that we shall go back, open front and back doors of this property and let them resolve this issue. The house has no insurance on it since we left and any goodwill or memories are long since gone.
On a final note, I think I shall email this issue to Willie Penrose TD. It was after all his bill whch changed the terms and perhaps if enough people make him aware he may be able to resolve this bureaucratic nightmare.
 
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Likewise, I wish you well.
In hindsight , it was a very short year for us and the relief in being able to answer 'private' phone calls and not having to avoid the postman is worth it alone.
Good luck.
Ah yes,
I remember that...the fear of the postman...as a former bankrupt, also now discharged, I can't say how radically different my peace of mind is...no debt / loans etc.
nobody calling or knocking, no threatening letters etc. etc. etc.
no home anymore either, but it was definitely worth it.
it is a nuclear option, but my situation required a nuclear solution.
 
Hi Catastrophe,
Just a quick question, how long did it take from the time you applied online for bankruptcy and getting called to court?
I’m meeting with a PIP and they advised me their fee is 5000 euro. He said I could go through IMHO but it would take much longer. Just want an idea of the time frame? Also, did you get your IcB sorted after?
Thank you
 
Saw a piece in today's Indo in relation to Bankruptcy which some may find important. The onus it would seem is on the bankrupt person to let their house insurer know of their bankruptcy, it seems it's not easy at all for such persons to get insurance. Might help someone or at least make them alert to the fact.
 

That fee is ridiculous. If you do the paperwork yourself (which is really just a load of tables and figures) then you can get same checked by the PIP and they'll give you a letter stating ye need to go bankrupt. My wife and I went bankrupt for a total of €750 plus VAT payable to the PIP plus about €500 more to the Court Service.

Just make sure you're under the RLE's or you'll be in a world of pain :(

PM me if you would like the name of the PIP.
 
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