For anyone who is in financial difficulty, the appeal of these sites you will see on Google when you look for 'debt help' or 'debt advice' could be the answer to your prayers. The fact is that the new 'Irish Government Insolvency Act' does not actually exist!
The majority of debt management companies who offer this service are generally UK-based, and as the industry as it stands is unregulated, outside the scope of any regulatory body in Ireland. What they are offering is a poor alternative of the UK's Individual Voluntary Arrangement.
Be advised, the closest alternative we have here in Ireland is called a Formal Scheme of Arrangement, where a portion of your debt can be written off. The difference is, that where the UK put through over 50000 IVAs in 2010, in Ireland, only 10, yes 10 Formal Schemes were entered.
The reason for this is that in Ireland any FSA must go through the High Court, and there are huge risks involved in even proposing one. If less than 60% of your creditors agree, the FSA will fail and you will probably be declared bankrupt immediately. The cost of an FSA is similar to bankruptcy, up to €30000, sometimes more.
Generally these sites offer this as a hook, to get you to pay up your initial fees first, then tell you that you can only enter a 'Debt Management Plan(DMP).'
Until new legislation becomes a reality in 2012, a DMP is generally the only real solution to dealing with your secondary debts such as credit cards and unsecured loans. But again, beware of the charges you are agreeing to. Most of these companies charge one, two or even three months worth of charges, subject to a minimum of €500 a time.
The result is that your creditors will not receive any payments until your initial fees have been paid to the management company, potentially up to six months, seriously damaging an already fragile relationship with these creditors.
Look carefully at the small print, ask what the costs of a debt management plan are, as any DMC worth their salt will offer advice free of charge, and only charge you the equivalent of your disposable income for one month as a set up fee. The problem is, that when you have paid a large initial fee, there is less of a reason for that management company to ensure you stay on track with your plan. If you opt out, or run into difficulty further down the line, they are less likely to assist you.
www.frost.ie
The majority of debt management companies who offer this service are generally UK-based, and as the industry as it stands is unregulated, outside the scope of any regulatory body in Ireland. What they are offering is a poor alternative of the UK's Individual Voluntary Arrangement.
Be advised, the closest alternative we have here in Ireland is called a Formal Scheme of Arrangement, where a portion of your debt can be written off. The difference is, that where the UK put through over 50000 IVAs in 2010, in Ireland, only 10, yes 10 Formal Schemes were entered.
The reason for this is that in Ireland any FSA must go through the High Court, and there are huge risks involved in even proposing one. If less than 60% of your creditors agree, the FSA will fail and you will probably be declared bankrupt immediately. The cost of an FSA is similar to bankruptcy, up to €30000, sometimes more.
Generally these sites offer this as a hook, to get you to pay up your initial fees first, then tell you that you can only enter a 'Debt Management Plan(DMP).'
Until new legislation becomes a reality in 2012, a DMP is generally the only real solution to dealing with your secondary debts such as credit cards and unsecured loans. But again, beware of the charges you are agreeing to. Most of these companies charge one, two or even three months worth of charges, subject to a minimum of €500 a time.
The result is that your creditors will not receive any payments until your initial fees have been paid to the management company, potentially up to six months, seriously damaging an already fragile relationship with these creditors.
Look carefully at the small print, ask what the costs of a debt management plan are, as any DMC worth their salt will offer advice free of charge, and only charge you the equivalent of your disposable income for one month as a set up fee. The problem is, that when you have paid a large initial fee, there is less of a reason for that management company to ensure you stay on track with your plan. If you opt out, or run into difficulty further down the line, they are less likely to assist you.
www.frost.ie