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Burton calls on banks to do more for struggling mortgage holders

The Minister for Social Protection said that banks and mortgage institutions were not doing enough for people in financial difficulty.

Joan Burton
Joan Burton
Image: Photocall Ireland

THE MINISTER FOR Social Protection has called on the banks to do more to engage with mortgage holders struggling to pay off their debt.

Joan Burton was speaking amid growing calls for mortgage holders in Ireland to be offered some form of debt forgiveness.

New figures due out from the Central Bank tomorrow are expected to show that the number of people in mortgage arrears is rising by 20,000 per year, according to the Sunday Business Post.

Speaking on RTÉ’s This Week programme, Burton acknowledged that families across the country were struggling with mortgage issues and called on the banks to do more on a case-by-case basis.

She said:

I think every family in Ireland knows of some friend or family member who has a mortgage, they’ve lost their employment or they have lost, for instance, overtime or their salary has been cut and they’re finding it hard going.
If you have a lender who’s in distress and you have a bank or an institution which has lent that person money, if the bank wants to get much of their money back and the lender generally wants to try and pay back what they can pay back, the two of them have to sit down and they have to have a discussion about it, and it has to be done on a case-by-case basis.

She said that the National Asset Management Agency had been doing for developers what the banks needed to be doing for ordinary people and said that every mortgage holder who has difficulties needs to be able to approach their bank.

Since the idea was floated by the UCD economist Morgan Kelly nearly a fortnight ago, the idea of writing off mortgages for struggling homeowners has been fiercely debated.

Other economists have described the measure as being an “emergency need” however the government has sought to play down the possibility of introducing such a policy, questioning the cost and justification for it.

Burton said today she did not think “the banks and mortgage institutions are actually engaging sufficiently with people.”

However she insisted the government was already providing significant support to people in the form of €70 million that will be spent this year to help about 18,000 families in distress with their mortgages through mortgage interest supplements.

“We need banks to engage with this and the government is actually providing, through the Money Advice and Budgeting Service, through the community welfare officers, through my department, significant amounts of money,” she added in her interview with RTÉ.

Read: Writing off mortgage debt is an “emergency”>

Read: Morgan Kelly calls for debt forgiveness for struggling mortgage holders>

Read: Government seeks to play down possibility of mortgage relief scheme>

About the author:

Hugh O'Connell

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