Thank you. In your opinion (if any). What would be the best option?Personal insolvency options
There are 3 debt resolution procedures to help people with unsustainable debt to reach agreements with their creditors.www.citizensinformation.ie
Thank you for your advice. If they do not accept a settlement what would be the worst case scenario. Will they take it to court or would I have to go into bankruptcy?You generally use a DSA if you have multiple debts and a PIA if you have "secured" debt. In your case, you appear to have just a single unsecured creditor, so a negotiated solution is the best and cheapest option. (A DSA could cost you about €5,000),
The debt collection company would have purchased the debt at a discount, so they should be receptive to a deal, particularly given your new financial circumstances.
There could be a sting in the tail if you do negotiate a write off. The amount written off may become taxable if the loan was used to finance your sole trader business.
Jim Stafford
You have received excellent advice from a well known professional here, and some very bad advice from an anonymous poster, you should certainly not try to get a friend or family member to give their money to debt collectors. That is called feeding the shark.
Here is some more anonymous advice.
Ignore them and they will go away. You have no income, you have no assets, it will cost them €10k to make you bankrupt , and they would get no benefit from that. Engaging with them only encourages them.
For example, you may have a friend or family member who is willing to support your offer
This would be the most simple and cost effective solution.
what's to stop the creditor from getting a judgement in the circuit court, thus giving them 12 years to enforce the judgement? Costs would be minimal to get such a judgement.
Often good advice but that is a moral position and not the only possible view, see below.Cremeegg
With respect, your advice is terrible.
People should face up to problems and resolve them. Not bury their heads in the sand.
He is obviously worried about this and having an unsecured debt hanging over my head would worry me too.
What happens if he ignores them and subsequently gets a job or an inheritance. They could come after him again.
While he has no assets and no income, it is the time to resolve this.
If this was a consideration I might agree but the OP does not own his own home, see post #1What's to stop the creditor from getting a judgement in the circuit court, thus giving them 12 years to enforce the judgement? Costs would be minimal to get such a judgement.
If a debt collector smells money they are only encouraged. If he offered E2,000 their reaction would be, well why not E4,000 or more. If they got E2,000 what is to stop them coming back for more. Before you say a binding legal agreement, that would cost more than the E2,000.But if you can access a small amount e.g. €2,000 to get the balance written off, it's worth considering.
Brendan
Check with MABS first. If MABS can get it written off without any payment, that would clearly be better.
I am in no doubt that the debt collectors will go away if he ignores them, what alternative do they have?
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