The Dáil will debate a Fianna Fáil motion tonight and tomorrow morning which seeks key changes to the government’s approach to tackling the escalating mortgage arrears crisis.
Among the measures called for by Fianna Fáil are:
- a clear definition of a ‘sustainable solution’ under the Mortgage Arrears Resolution Targets programme
- the Central Bank to report on the performance of the banks to date on reaching the resolution targets
- consistent rules to be applied by banks to split mortgages
- legislation, if necessary, to give qualifying borrowers a right to a long-term sustainable solution
- an independent investigation into the issue of ‘strategic default’
- the establishment of an independent mortgage resolution office
- steps to ensure that the cost of engaging a personal insolvency practitioner is not a barrier to a person availing of the new service
Fianna Fáil Spokesperson on Finance Michael McGrath commented: “I am pleased that Fianna Fáil is dedicating its first private members’ motion of the new Dáil session to the issue of mortgage arrears. The laying down of the motion has already helped to generate action as the Central Bank yesterday issued welcome targets for banks to reach agreements on sustainable solutions with borrowers.
“One of the most worrying elements to emerge from the latest Finance Committee hearings with the banks is the level to which banks are relying on issuing legal letters to borrowers in order to meet their obligations under the Mortgage Arrears Resolution Targets Programme.
“Without a clear definition of what a ‘sustainable’ solution is and a consistent approach across all the banks, we will not effectively tackle one of the greatest social and economic challenges facing the State. Over 57,000 family home mortgage accounts are in arrears for more than one year with the total number of accounts in arrears now close to 143,000 at the end of June this year. This problem is getting worse, not better.
“The Government and the Central Bank need to wake up to the fact that the banks are not going to move on their own. The fact that there are still only 309 split mortgages in operation and a permanent interest rate reduction has been applied to only 254 mortgage accounts at the end of June shows us just how far we have to go to address the extent of the problem.
“Legal letters and the threat of repossession cannot be regarded as a sustainable solution. We need a robust regime overseen by the Central Bank with published targets, published progress reports and a clear definition of what is appropriate for banks to put on the table in the resolution process.
“The motion we have put down is not adversarial in nature. It is designed to stimulate debate and action on this critically important issue.”