Bankruptcy is a formal process that can be used when a debtor is insolvent. The process can be initiated by creditors, but typically a debtor seeks bankruptcy as an option to deal with unaffordable debts. For you to be eligible for bankruptcy, you would first need to be assessed for suitability for personal insolvency. To do this, you need to speak with a Personal Insolvency Practitioner (PIP). A PIP is authorised and regulated by the Insolvency Service of Ireland. If you are deemed to be unsuitable for a personal insolvency scheme, then bankruptcy may be an appropriate option.
In Bankruptcy, the ownership of any material assets including your home, can transfer to the Official Assignee in Bankruptcy (the OA). The OA is an office of the Insolvency Service of Ireland, who administer the process of bankruptcy. The OA will then seek to sell your assets for the benefit of your creditors who are owed money. Immediately on being adjudicated bankrupt, your debts are written-off.
Depending on your financial position, you may be required to make a financial contribution towards your bankruptcy for a period of up to 3 years. This is called a Payment Order and is determined based on what the OA feels is fair, reasonable and affordable to you. In some cases, particularly if you have a low income, there may be no Payment Order set, and your Bankruptcy could be completed in as little as 1 year.