Americans are not the only ones struggling with overwhelming debt and bankruptcy filings. The Republic of Ireland has been suffering a similar foreclosure crisis and mortgage industry breakdown. After more homeowners in Ireland lose their homes, the government has decided to overhaul bankruptcy laws in hopes of reaching more of those in need.
Changing Their Ways
Current laws in Ireland prohibit a debtor from receiving a discharge for 12 years following a prior bankruptcy. Many debtors are also disqualified early on through stubborn eligibility criteria and other strict guidelines. Under the new laws, more debtors will qualify for bankruptcy protection and second time filers may be able to obtain a discharge in as few as three years.
These changes were brought about largely due to the failing state of the Irish economy. With a debt load of 129 percent of the GDP, Ireland is boasting one of the largest debt burdens in the developed world. Having also bee devastated by housing market and supporting a high unemployment rate, the Irish economy is simply too small to fight off the quick spreading effects as a larger nation could. The change in laws is hoped to allow more homeowners to resolve their debt troubles, save their homes outside of the court system and open up more flexibility in lending practices.