The Irish Mortgage Holders' Organisation (IMHO), which in November announced a deal with AIB to mediate officially for holders of distressed mortgages, plans to expand the scheme to include other banks.
The organisation last night revealed results from the first two months of its six-month pilot scheme with AIB. Director David Hall said he plans to approach AIB for further funding to expand it.
He also said it had held discussions with "two other large banks" about expanding the scheme to include their distressed mortgage holders, and is due to meet one of them this week for further talks. IMHO is also setting up a similar scheme with subprime lender Stepstone Mortgages.
In the first two months, AIB sent “activation packs” containing the IMHO’s details, an authorisation letter and other information such as a standard financial statement, to 1,011 mortgage-holders.
About 440 of these responded and to date IMHO has sent in 263 proposals to AIB on behalf of customers. From these, about 123 “long-term sustainable solutions” have been agreed with the bank.
Mr Hall said some of these settlements involved mortgage debt write-offs.
“About 26 of the deals involved the property being sold or surrendered. About half of those involved got the remaining debt completely written off. The rest involved monthly payments on the residual debt, following sale, for up to seven years,” he said.
Mr Hall said IMHO, which hired six staff for the trial using a €150,000 grant from AIB, had been "visited" by the Central Bank and by a number of TDs to observe how the scheme worked.
“The results on mortgage arrears schemes have been pathetic from the banks so far. But AIB has conceded that this scheme is working. We will be approaching it for further funding, and we hope that this template can be expanded,” he said.
Mabs
Mr Hall also proposed that IMHO could work in conjunction with the State-backed Money Advice and Budgeting Service (Mabs) to help mortgage customers in arrears.
He said he would like to see a process to allow Mabs refer to the IMHO clients who needed assistance on mortgage debt negotiations with banks. He also said the group may expand beyond dealing with mortgage debt.
AIB said the trial was “meeting expectations”.
