When I asked why he didn't do it, he replied ruefully: "Because I couldn't afford it".

Bizarre as it may seem, going bankrupt is simply too expensive. In the UK, personal insolvencies are heading for record levels at over 10,000 every month. Here, they ran to just nine in one year (2005).

To declare oneself bankrupt . . . or seek to have a debtor declared bankrupt . . . you need a solicitor. And guess what?

Solicitors don't come cheap and aren't exactly falling over themselves to offer services to people who have no money.

We rang a few legal firms for comment. They typically replied: "We don't have anyone who works in that area. We mainly do conveyancing and personal injuries."

You could try to get free legal aid, but according to a source, this is practically unheard of.

"The system is not designed for personal debt problems, " he said.

With interest rates rising, property prices falling and debt levels soaring to unprecedented heights, it might be timely to take a look at what does happen to people who get in over their heads.

Paul Joyce, senior policy researcher with the Free Legal Advice Centres (Flac), sums up the system in one word:

"Crazy". Michael Culloty, spokesman for the Money Advice and Budgeting Service (Mabs), has another one: "Dickensian".

Here's how it works: Sean is bombarded with offers of easy credit. He gets several credit cards whose limits are continually raised automatically.

Convinced he is living in a consumer paradise, he spends like there's no tomorrow.

Tomorrow arrives. Interest rates rise and Sean finds he can't meet repayments. But he finds "the solution to all his problems" . . . an ad for a subprime lender aimed at people like him. It shows friendly, good-looking people smiling, unlike his bank manager, who now wears a forbidding frown.

They arrange everything in a jiffy on the phone. All he has to do is secure the loan on the family home. He doesn't even register the interest rate.

Sean clears his credit card debts but still has the cards in his wallet, tempting him to spend thousands of euro. He starts racking up debt again.

Why can't he manage his money? Well, nobody ever showed him. The golden rule of Irish education seems to be:

Never Teach Anything That Might Be Remotely Useful in Later Life. Sean learned how to use logarithmic tables, but nothing about being screwed by a predatory lender.

A year and a half later, interest rates are still going up and so are his debts. He owes as much as he did before on his credit cards, only this time he has a big fat remortgaging loan on top of that.

Sean is in trouble. But with seven different lenders hounding him for ever-mounting repayments, he knows it's out of control and buries his head in the sand (instead of going to Mabs and cutting a deal with his creditors. ) The sub-prime mortgage lender doesn't mess around. It targets people like Sean and moves swiftly in for the kill, seeking repossession of his home. The other six creditors go down the only route open to them and seek a court judgment for repayments.

Sean can't afford a solicitor and is too intimidated even to show up in court for the seven cases taken against him. Judgments are granted in several and then served, ordering him to pay up or face the wrath of the court . He can't.

The creditors go back to the respective judges, none of whom knows anything about the other cases, and plead that Sean is in contempt of court.

At least one judge, if not more, will have no option eventually but to commit him to prison.

The predatory lender, meanwhile, gets a repossession order for his home.

Sounds far-fetched? Yet between 2002 and 2006 almost 1,000 people went to prison over debt. Repossessions are also shooting up. In the past, mainstream lenders repossessed a couple of homes a year. Recently it emerged that one sub-prime lender alone has dozens of repossession orders on its books.

The upshot is that nobody wins. The creditors, apart from the predatory sub-prime lenders, don't get paid and rack up legal costs on top of what they lost already. Courts and prisons are clogged up with messy and unnecessary legal actions and committals, at huge cost. (It might be cheaper for the state to pay the debts of errant borrowers. ) And the debtor's life and his health are often wrecked.

Little wonder that two unlikely bedfellows . . . Mabs and the Irish Bankers Federation (IBF) . . . have teamed up in a bid to set new protocols for negotiations between creditors and defaulting borrowers.

Mabs and IBF implemented a pilot scheme in 2002 whereby 30 borrowers agreed to pay each of their creditors on a pro-rata basis. Part of their debt was written off and they were left with a realistic income to live on.

Hopefully they will help sort out a problem that the government has refused to address. The Bankruptcy Act was last updated in 1988, but as one source said: "It might as well have been 1888."

btyson@tribune. ie