Access to the cost of credit will continue to be a major factor in the success of farm business. In addition to resolving the current credit problems, we have considerable expertise in the formulation of business plans and financial projections for the purpose of making submissions and applications to financial institutions for farming and Agri-Business finance.
The New Debt Relief Roadmap
DEBT PROBLEM RESULTING IN PERSONAL INSOLVENCY
TRADITIONAL/NORMAL NEGOTIATION/AGREEMENT ON LOAN RESTRUCTURING AND WRITE-OFFS
Apply to Insolvency Service of a Debt Relief Certificate. Unlikely to be of practical use to farmers –assets must be less than €400.
NO AGREEMENT POSSIBLE
Farmer engages a Personal Insolvency Practitioner (PIP). PIP applies for Court protection from creditors. Advise farmer debtor on options. Draws up Financial Statement. Subject to criteria, PIP proposes Debt Settlement Arrangement (DSA) or Personal Insolvency Arrangement
Debt Settlement Arrangement
Only for unsecured debts . Unsecured loans completely settled over five years.
Must be agreed to by at least 65 % of creditors in value.
Rejected or fails
Personal Insolvency Arrangement
Applies to secured and unsecured debt up to €3.0 million. Secured debt completely settled in six years. Special arrangements for family home.
Must be agreed to by at least 65 % of creditors in value and at least 75 % of secured creditors in value and at least 55 % of unsecured creditors in value.
. Rejected or fails
Applies to all debt over €20,000. The new law encouraged debtors and creditors to use the above processes in preference to bankruptcy if feasible. No negotiation or flexibility –all the debtor’s property and assets passes to the Official Assignee for distribution to creditors in accordance with the Bankruptcy Act. Subject to certain condition to be met, the bankrupt will be automatically discharged after three years.