Mortgage debt report 'has no strategic solutions'

Wednesday 05 December 2012 12.29
The Taoiseach is open to ideas on how to tackle mortgage crisis
The Taoiseach is open to ideas on how to tackle mortgage crisis

The long-awaited government report on the growing mortgage debt crisis doesn't tackle the problem for strugglng householders

Struggling mortgage holders, terrified their homes will be repossessed, will not find any solutions in a new government report into the growing domestic debt crisis, it has been claimed.

The so-called Keane report, will include some level of debt forgiveness but will not come up with an overall strategic solution to the problem of arrears that is now affecting 95,000 home owners.

The report published on Wednesday, October 12, has been put together by a working group of civil servants headed by the department of finance official Declan Keane.

David Hall, the founder of an organisation that provides free legal aid to those facing repossession in the courts branded the government’s efforts “wishy washy” and "pathetic".

Earlier today the government considered the report and said it was open to ideas to tackle the problem.

Hall told Six One News that the Taoiseach’s call for help showed that there was much work to be done.

“Our view is that the government now have a luke warm feeling to this report they commissioned a report by a group of civil servants who all advised the previous governments in relation to this monumental catastrophe and now there’s been a spectacular failure of expectation by the government to the public over the last six weeks that this was going to contain solutions," said Hall whose organisation New Beginning offers barristers' time for free for those being pursued by their banks.

“Suddenly we have the Taoiseach calling for help from the opposition and other groups who were excluded from the consultation process in advance of this report being published.

“This is all wishy washy stuff, this is pathetic and having a report leaked in such a piecemeal way is showing disrespect to the people who are genuinely in pain,” said Hall.

The Keane report is the third report aimed at tackling personal debt and follows the Cooney report and the Law Reform Commission report which recommended changing Ireland’s draconian bankruptcy laws.

It is reportedly recommending a new army of 100 financial advisers to work alongside the Money Advice and Budgeting Service.

It will also, according to the Irish Independent recommend that

  • Some repossessed homes will be taken over by local authorities who will then lease them back to their owners who will become tenants
     
  • That banks and other lenders should consider setting aside, or warehousing a portion of the capital owed on a property for a set period to enable the owner get back on their feet.
     
  • Negative equity mortgages for those that want to trade down but find they can’t sell because the property market is paralysed. These will enable owners to carry their mortgage with them but move house.