The appalling state of the sub-prime mortgage book has been revealed by a series of figures released to Fianna Fáil Spokesperson on Finance Michael McGrath, along with confirmation that the government has still not set targets for the resolution of sub-prime arrears cases.
Deputy McGrath stated, “The Minister for Finance Michael Noonan has confirmed that 57% of the family home sub-prime mortgage book is in arrears of 90 days or more. Of a total sub-prime mortgage book of €3.316 billion, accounts amounting to a staggering €1.88 billion are in arrears of over 90 days. Despite this, the Minister has confirmed that the Mortgage Arrears Targets Programme has still not been extended to sub-prime mortgages.
“In addition, the Minister has confirmed that one in every four home repossessions since the beginning of 2012 relate to sub-prime mortgages. The simple truth is that the government has shown scant regard for the 18,000 sub-prime mortgage holders – many of whom are now in real danger of losing their family home. At this point, we have no indication of type of solutions being offered to sub-prime mortgage holders.
“It is inexplicable that the government continues to exempt the sub-prime mortgage sector from the Mortgage Arrears Targets Programme. Sub-prime mortgages are among those most in need of permanent restructuring and the Minister should move immediately to apply rigorous restructuring targets on sub-prime lenders. In particular, the Minister should put the spotlight on the interest rates being charged which are often exorbitant in the case of sub-prime mortgages.
“The Mortgage Arrears Resolution Targets (MART) announced in March 2013 are far from perfect but they at least led to more solutions being offered to customers. It is well past time that the government and Central Bank extended the MART Programme to sub-prime lenders in order to save as many of these family homes as possible.”