What is a Personal Insolvency Arrangement?

A Personal Insolvency Arrangement (PIA) is an insolvency solution for people with unsecured and secured debts. Secured debt is a debt backed or secured by an asset (e.g. a housing loan where a house is mortgaged to secure the loan debt).

It is a formal agreement with creditors that will write off some unsecured debt and restructure any remaining secured debt, while keeping the person in their home where possible.

A PIA can last for 6 years – but can be less e.g. if a lump sum is available.

Unsecured debts – e.g credit cards, personal loans can be included.

Secured debts – mortgage debts may be settled, restructured and or written-down.

You are protected while your PIA is in place. Creditors such as banks cannot take any legal action against you.

At the end of your PIA the balance of any unsecured debts is written-off and the terms of your secured mortgage debt are restructured in accordance with the terms in the PIA.

You can only have one PIA in your lifetime.

Applying for a Personal Insolvency Arrangement

In order to apply for a Personal Insolvency Arrangement , a person should contact a Personal Insolvency Practitioner (PIP) – these are a network of qualified professional advisors regulated by the ISI to deal with Personal Insolvency Arrangements and are experts in the area of debt advice.

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