Former publican in Cork has €2.4m in debts written off
Court approves personal insolvency case reducing home mortgage by €170,000
Gary Hyde, who ran The Castle Tavern in Glanmire, will see his monthly repayments fall to €1,821 on a tracker mortgage rate of 0.75 per cent for 21 years. Photograph: Chris Maddaloni/Collins
A former publican in Cork has had debts of more than €2.4 million written off in a personal insolvency arrangement approved by the High Court.
He was unable to service debts due on his other investments and fell into mortgage arrears.
Mr Justice Denis McDonald approved a personal insolvency arrangement – a post-crash legal mechanism that allows debtors escape unaffordable mortgage debts – that will result in his €589,900 mortgage on his home being reduced to property’s current market value of €420,000.
The remainder of his €2.85 million in debts, including almost €1.8 million due to debt recovery company Everyday Finance, will be written off for a settlement payment of €2,000 on the unsecured proportion of the debt.
The 51 year old will see the mortgage on his house reduced by almost €170,000 and his monthly repayments fall to €1,821 on a tracker mortgage rate of 0.75 per cent for 21 years.
Their debts will be almost fully written off in the personal insolvency arrangement, a type of debt restructuring which allows insolvent debtors to walk away with more sustainable debts.
The arrangement was devised by personal insolvency practitioner Alan McGee and argued for in court by barrister Keith Farry.
Promontoria tried to block the personal insolvency arrangement on the grounds that GE Capital Woodchester’s debt was treated as an unsecured creditor which would have affected the vote for the restructuring.
The judge concluded that GE Capital had waived its status as an unsecured creditor, which he said was “an entirely realistic and appropriate course”.
There have been about 4,000 personal insolvency arrangements agreed since the personal insolvency legislation was changed in 2015 to remove the so-called bank veto on writedowns.