THE DEPARTMENT of Social Protection is finalising an implementation plan for the future of the mortgage interest supplement scheme to assist homeowners in arrears, Minister for Finance Michael Noonan has said. He told the Dáil the changes would require primary and secondary legislation.
Mr Noonan said recommendations of an expert group established to look at mortgage debt suggested that a deferred interest scheme should be put in place.
“This is intended to allow borrowers to pay at least 66 per cent of their mortgage interest but less than 100 per cent and defer payment of the balance for up to five years, based on a full appraisal of an individual borrower’s circumstances.”
The Minister said that mortgage lenders had indicated their willingness to implement such a scheme and the Government “is sharply focused on the problems faced by homeowners in arrears with their mortgages. We find ourselves in difficult economic circumstances where there are no easy or costless solutions. It is important to emphasise in this context the success of the existing supports as illustrated by the low level of repossessions at present.”
Mr Noonan said that through its agencies, “the State is assisting mortgage holders in arrears in a measured and proportionate manner”. He also said the Minister for Justice would give “early attention” to the final report on Personal Debt Management and Debt Enforcement published by the Law Reform Commission, which contains recommendations “on comprehensive reform of the system of personal insolvency law in Ireland”.
The Minister was speaking during a private members’ debate on residential mortgage debt introduced by the technical group of independent TDs. Thomas Pringle (Ind, Donegal South West) said the motion was an attempt to put the mortgage crisis “centre stage” and explore possible solutions. He said the Government had missed the opportunity to be “truly radical” and put the people first. He said that as bank recapitalisation was now put at more than €70 billion and national debt heads for more than 125 per cent of GDP “hundreds of thousands of households in the country are suffering from ever increasing mortgage arrears and negative equity”.
they needed as “a matter of urgency” to develop policies to lift people “out of this massive burden and enable them to participate in the domestic economy”.
He said at the end of 2010 over 13,000 mortgages were in arrears of 90 days or more, 31,000 mortgages were in arrears of 180 days with a total value of more than €8.6 billion values.
