Fianna Fáil Spokesperson on Finance, Michael McGrath TD has called on Permanent TSB to issue an urgent public statement on a number of aspects of the proposed loan portfolio sale to Start Mortgages controlled by US vulture fund Lone Star.
Deputy McGrath commented, “Thousands of mortgage holders yesterday received a letter from Permanent TSB informing them their mortgage is being sold, including relating to 7,400 family homes.
“With the letter arriving in the letterbox on the Friday of the August bank holiday weekend, it is hard to avoid the conclusion that the bank deliberately chose the timing to avoid as much scrutiny as possible.
“In my view, the timing of this announcement is cynical and is adding to the stress and worry of affected borrowers during the holiday season.
“I have been contacted by many mortgage holders in the past 24 hours who have been taken completely aback to learn their mortgage is being sold.
“Many bank customers are shocked to learn their loan is being sold. These customers include:
· Borrowers whose family home mortgage is not in arrears but who have a buy to let mortgage with arrears have been told their home mortgage is also being sold;
· Borrowers who are meeting the terms of a restructure agreement on their family home mortgage for a varying amount of time;
· Borrowers with a split mortgage where old arrears has now been cleared;
· Borrowers who are adamant they were engaging with the bank to agree a loan restructure but the engagement from the bank was poor or nonexistent.
“In the lead up to this sale, Permanent TSB and the Minister for Finance gave the impression that the only customers affected by this loan sale were those who were in deep arrears and who were not engaging with the bank. Based on the contact I have had with borrowers all over the country since Friday, this is categorically not the case.
“As the shareholder owning 75% of the shares in the bank, the Minister for Finance has a duty to ensure that the bank answers a series of key questions about this loan sale. The categories of customer described above deserve to know why their loan is being sold to a vulture fund and whether they can be removed.
“We also need to know the respective role Start Mortgages and Lone Star will play in this portfolio sale. Is it the case that Start Mortgages is merely going to act as servicing agent to these the loans with Lone Star making all the decisions in the background?
“Will the new loan owner actually engage constructively with borrowers and be willing to enter into the mainstream restructuring arrangements such as term extension, arrears capitalisation, split mortgage and interest only?
He concluded, “Major questions arise this weekend in relation to this proposed loan sale and the cold and calculating way it has been handled. Both the bank and the Minister now need to step up and provide some answers.”