New insolvency law helps worker see 70% of debt written off

Personal debt campaigners say hundreds of more people will soon benefit from the new insolvency regime.

A Donegal HSE worker last night became the first person to enter an arrangement under the Act. In that case, 70% of his/her debt was written off.

It is understood the individual was left with unsecured debt following the collapse of a business.

The agreement was reached at a meeting organised with the help of the New Beginning group.

The group's founder Vincent P Martin says the deal is a landmark moment for struggling borrowers.

"There are hundreds more following, and if the creditors or the majority of the creditors... face up to this, we will have a better Ireland and a better future for everyone, and a better economy, which will help creditors in the long term," he said.

A study of the 20 deals has found that one in four families are voluntarily surrendering their homes in return for debt relief.

In many of the instances, those who are struggling with home loan repayments are also in employment.

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