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Dublin: 3 °C Wednesday 13 November, 2019

Why won’t the ISI give a breakdown of applications processed, asks IMHO

The Irish Mortgage Holders Organisation says emergency legislation is needed to ensure PIPs are affordable.

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Money saving

THE IRISH MORTGAGE Holder’s Organisation has criticised the newly established Insolvency Service of Ireland, questioning why they have not released the number of applications they have processed to date.

The Irish Mortgage Holder’s Organisation said the “final judgement of success for the ISI will be its ability to strike deals and get struggling debtors through its process in large volumes. However again progress has been uninspired”.

David Hall of the Irish Mortgage Holders Organisation said that the ISI claimed on 1 October that they received 6,000 phone calls and emails and had received 85,000 visits to its website, however they “refused to give a breakdown of the number of applications for debt relief from struggling borrowers in order to protect their confidentiality”.


David Hall said “the sudden interest in confidentiality by the ISI is very odd given that once a protective certificate is issued it is put on a register and all deals, along with their progress is also placed on a register. Both registers are currently empty”.

The IMHO state that a number of Personal Insolvency Practitioners (PIPs) have confirmed that the ISI have written to all PIP’s advising that protective certificate’s to seek a debt deal cannot yet be applied for.

It is clear that the ISI is not “currently functioning in a meaningful way,” adding that “since throwing open the doors progress has not been stellar,” Hall said.

Proponents of the ISI will say it is early days yet we have had legislation since December 2012 and an Insolvency Service in existence since March 2013.

The fear is that the very real teething problems will be brought into sharper contrast when the deals do actually start to follow through, in whatever volume that is.


He said that one of the main failings that must be dealt with is the strict eligibility criteria. He added:

Grant Thornton estimated in a piece of research that only 1 in 7 people who sought a deal would be eligible to go forward for one.

The Irish Mortgage Holders Organisation estimated that the average family of four would need a net income of €3,000 per month to successfully conclude a deal.

This breaks down as €1,500 for living expenses, €1,000 for rent or a mortgage payment and at least €500 per month of a pot to pay to creditors and pay a PIP’s fees.

However it is in excess of the average household take home pay as outlined by the Irish League of Credit Unions study undertaken in May 2013.


According to David Hall, “a pot for creditors smaller than €500 per month gross of PIP fees would be highly unlikely to succeed given the veto that banks hold and the cost to the banks of administering deals once agreed”.

The IMHO said there need to be two changes made immediately.

Hall said that “if we really want to stop the paralysis of debt we need a modern, affordable and fair insolvency system”.

He called for emergency legislation to be introduced making two key changes. Firstly the introduction of public Personal Insolvency Practitioners will provide services to those who can’t afford PIP fees but who may have a chance of reaching an agreement with their creditors.

Secondly, for a period of two years only, a special bankruptcy regime with discharge after one year, should be introduced. This would bring us in line with our neighbors in the UK It would  allow real debt deals to be negotiated with banks and if not successful allowing the borrower apply for a one year bankruptcy period.

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