Neo Financial Solutions

FAQs

WHO CAN GO BANKRUPT?
An individual or individuals who are business partners can go bankrupt jointly. A couple who have a joint mortgage or jointly owe loans cannot go bankrupt jointly. They must do a separate petition and file for bankruptcy individually.

CAN I DECLARE MYSELF BANKRUPT?
Yes a debtor can file for bankruptcy themselves if they are in a position that they cannot pay their bills and/or they are insolvent.

HOW LONG DOES BANKRUPTCY LAST?
The amendments to the bankruptcy act brought in by the Bankruptcy (Amendment) Act 2015 has reduced the term of bankruptcy from 3 years to 1 year.  With an automatic discharge after 1 year as long as the debtor has co-operated with the OR and has not attempted to hide any assets or income.
WHAT HAPPENS TO THE FAMILY HOME IN BANKRUPTCY?
There is a lot of confusion around the status of the family home in bankruptcy. When entering bankruptcy you should always assume that the family home may be lost especially if there is joint ownership, it is not in negative equity and both parties are declaring bankruptcy. There are however, some circumstances where the family home can be kept or at least the sale of the home can be delayed for a period of time.

If the family home is not sold within 3 years of the bankruptcy the ownership of the home will revert back to the bankrupt. This will happen automatically without any payment to the OA, the need for conveyance or legal fees.

It is important to note that all debt attached to the family home will remain attached to the home unless paid off or creditors agreement to write same off.

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CAN I EARN INCOME AND BE EMPLOYED WHEN I AM AN UN-DISCHARGED BANKRUPT?
Yes in bankruptcy the debtor is allowed to continue to work and earn a living. In fact for those in employment bankruptcy will have no effect at all on their employment status. Their income will only be effected if they are in receipt of a large salary in which case they may be subject to an attachment order on some of their income payable to the OA.
CAN I HAVE A BANK ACCOUNT WHILE I AM AN UN-DISCHARGED BANKRUPT?
Yes it is often thought that a bankrupt cannot have a bank account. This is not true. The bankrupt can have a bank account but has to declare that they are an un-discharged bankrupt if they wish to borrow in excess of €620.

Currently, Ulster Bank and Bank of Ireland policy is to close all accounts held by a bankrupt and they do not wish to deal with the bankrupt going forward.

AIB and PTSB are willing to either open or reopen bank accounts for anyone who has declared bankruptcy. 

1 Year Bankruptcy Guide – 2016

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