Six- to nine – month amnesty for borrowers from legal action by banks proposed.
The Irish Mortgage Holders’ Organisation (IMHO) has proposed that banks, insolvency practitioners, the Government, regulators, and various other State agencies and debt advisory groups come together to try and formulate a big-ticket solution for long-term mortgage arrears.
IMHO chief executive David Hall confirmed to The Irish Times yesterday that the organisation, which provides free advisory services to people who are behind with their home-loan payments, met the Banking and Payments Federation Ireland (BPFI) before Christmas to explore the potential for a system- wide solution to this problem.
“We’ve made a proposal to the banking federation that the time has come for a meeting of all stakeholders to address the long-term arrears issue,” Mr Hall said. “How do we help these people? That has to be the conversation.”
He said the IMHO had proposed a six- to nine-month amnesty for borrowers from legal action by banks in a bid to encourage engagement with lenders to find a solution to their long-term mortgage debts.
In return, he said, the banks could seek an accelerated repossession process for those who continue to refuse to engage with the lenders. However, he accepted that this could run into legal difficulties.
Mr Hall said he has also sent an email to the Taoiseach Enda Kenny to seek support for his move and has written to other bodies to urge their involvement. “It’s at an early stage . . . but Rome wasn’t built in a day,” he said.
At the end of September last year, 37,269 owner-occupied mortgage accounts were behind with their loan payments by 720 days or more, with their total arrears amounting to just more than €2 billion.
Mr Hall has predicted that about 20,000 of these accounts could lose their homes if a solution is not found for them, including debt write offs.
A spokesman for the BPFI confirmed that a meeting with the IMHO had taken place, describing it as an early-stage discussion.
Fianna Fail finance spokesman Michael McGrath said there was “merit” in the approach being advocated by the IMHO. “The case-by-case approach by the banks hasn’t worked,” he said.
Reporting from Ciarán Hancock -The Irish Times