You have now reached the fifth and final step on your tackling debt journey. Well done!
If you have worked through the other 4 steps, you will have gathered all your financial information and made a money management plan. This money management plan is based on any improvements you can make. You have:
- Dealt with any urgent actions needed
- Made repayment plans, where necessary, with some or all of your priority creditors
- Explored your tackling debt options
If you have not completed the other steps yet, we recommend you take a look at them. Studying all the steps will help you to make sure you have chosen the right solution for you.
Action plan for tackling debt with money management
Make sure you have a realistic and affordable money management plan, then make payments to each of your creditors. These payments should cover your instalments and include some money to pay off arrears. You can use this way of tackling your debt along with other techniques described later.
Remember to keep all receipts and records of payments.
Action plan for tackling debt with voluntary arrangements
Deciding to approach your creditor with an offer to pay less than previously agreed can be a big challenge. To help you on your way, MABS can give advice on:
- Asking creditors to stop interest and penalty charges
- Drawing up a financial statement
- How to make offers to your creditors
- Deciding how to approach your creditors
- Types of repayment offers
Read more about voluntary arrangement options and the process involved
Action plan for tackling debt with formal insolvency arrangements
How to apply for a Debt Relief Notice (DRN)
You must apply for a DRN through an Approved Intermediary (AI). You can apply for a DRN through MABS. We will arrange a meeting for you with either a money adviser or one of our MABS staff members who are AIs. This is a free service. You can also choose an AI from the Register of Approved Intermediaries.
You have to complete a Statement of Affairs with full and honest information about your financial circumstances for the AI to assess and guide you through the process.
Read more about DRNs and the process involved.
How to apply for a Debt Settlement Arrangement (DSA)
You must apply for a DSA through a Personal Insolvency Practitioner (PIP).
You will be required to complete a Prescribed Financial Statement (PFS) with full and honest information about your financial circumstances.
Read more about DSAs and the process involved.
How to apply for a Personal Insolvency Arrangement (PIA)
You must apply for a PIA through a Personal Insolvency Practitioner (PIP).
You must complete a Prescribed Financial Statement (PFS) with full and honest information about your financial circumstances.
Read more about PIAs and the process involved.
How to declare yourself bankrupt
There are several steps you must take when you have decided to make yourself bankrupt. You can take the steps alone, but we advise you to get professional help. The Irish Mortgage Holders Organisation (IMHO) provides a free service (excluding Official Assignee and court administration costs) in relation to bankruptcy.
Read more about bankruptcy and the process involved.
Action plan for tackling debt with further borrowing
To consolidate debts means to combine them all into one loan. If you are thinking about taking out a consolidation loan, contact MABS to discuss your options as often a consolidation loan can make your debt situation worse. If you then decide to take out a consolidation loan, shop around for the best terms from a reputable lender. Make sure you understand all the terms and conditions of the loan and that you can afford to keep up the payments.
The equity–release option may interest you if you are aged over 55 and own your own home. Get legal advice before considering this option.
Equity-release loans are often secured on your home or other property. While this may seem like an attractive option (when available), there are serious dangers. When you release equity in your home, it often means you are turning unsecured borrowing into secured borrowing. This means you put your home or other property at risk.
If you are thinking about releasing equity from your home, contact MABS to discuss your options as releasing equity can make your debt situation worse.
You may have been paying high-interest rates on your unsecured credit. But equity release does not do away with paying interest. You will have to pay interest on the new loan for several years to come.
The original sources of credit can become available again and this can tempt you to borrow again. This opens up the possibility of multiple debts on top of the consolidated loan.
Read more from the Competition and Consumer Protection Commission about equity release mortgages.
You have now completed all five steps of the MABS tackling debt journey. What is most important now is to make sure you put your money management plan into action and stick to any arrangements you have made.
You will need to keep an eye on your finances and carry out regular reviews and keep your creditors up to date on your situation. If things change, let them know as soon as possible and update your financial plans.
MABS offers free advice and support
If you decide to contact MABS, it would be useful to have the following ready:
- Your questions
- Your most recent letters and emails
- Court documents from your creditors
- Any credit agreements (contracts – if you can find them)
You can also arrange to email your Full Financial Picture for an adviser to look at before your appointment if you wish. But even if you don’t have this information, still make the call and MABS will help!