Bankruptcy is a legal process whereby all debts are written off in full and any assets belonging to the debtor (aside from the normal requirements of life) are transferred to the Official Assignee (OA). To be eligible to apply for your own bankruptcy you must meet the following 3 criteria:

1. Your debts must exceed your assets by at least €20,000
2. You must be insolvent
3. You must first make reasonable efforts to reach an agreement with your creditors under the Personal Insolvency system.

The bankruptcy process lasts for 1 year.

If your income is above Insolvency Service of Ireland’s Reasonable Expenditure Guidelines (RLE) you may be required to make payments for up to 3 years.

Your family home can be sold in bankruptcy, but that needs the permission of the High Court. The OA will generally not seek to sell a family home if it is in negative equity. If the home is not sold it will transfer back to you after 3 years.

Pensions can be protected in the bankruptcy, you can speak to Nick in our Financial Services department about this.

There are certain restrictions in bankruptcy such as a restriction on being a company director during the 1 year period.