LOOPHOLES IN THE law and in mortgage deals have meant some groups in society are being ignored by processes put in place to protect homeowners it was claimed this week.
Speaking in a Dáil debate on Fianna Fáil’s Mortgage Arrears Resolution Bill, Sinn Féin TD Peadar Tóibín gave a number examples of people who are being “forced into homelessness” including those of women with children who are separated from their partners.
“Many of them are struggling to pay the mortgage on their own, to keep the roof over their heads. In most cases they are not getting any support from their former partner or the father of their children. Some of those women do manage to cut a deal with the bank or mortgage holder, but they often struggle to pay the agreed monthly repayment,” he said.
The banks say they require two signatures on any deal they make. One of the signatures must be that of the former partner. In some cases, because of the poisonous relationship between the couple, the former partner withholds his signature on any new deal with the bank, which means the deal cannot proceed. The bank wants a deal and the mother and children want a deal but it is prevented by the former partner. In such cases the women and children will become homeless because there is no alternative accommodation.
Tóibín also spoke of one woman he knows who has been struggling to pay the mortgage on her own after she separated. Her ex-husband stopped paying the mortgage for a number of years and filed for bankruptcy due to debts he had elsewhere. His name was taken off the deeds of the house and replaced by that of the official signee in the bankruptcy process.
Tóibín said the woman was told her ex-husband would have nothing to do with the house ever again. She has since remarried and she and her new husband are living in the house. However, he said last week, she was told that under government legislation “her ex-husband, who has contributed nothing to the house for eight or nine years, would have his name put back onto the deeds of the house and she has no control over that whatsoever”.
“I cannot adequately describe the level of stress she is experiencing at the moment. She is in a most vulnerable situation. Her ex-husband could move back into the house. He could possibly look to sell the house. He could also possibly look for further loans and potentially use the house as collateral,” he said.
Minister for Justice Charlie Flanagan interjected at this point to tell the deputy that the woman’s ex-husband could not look for further loans, but made no further comment on the situation.
“I ask the Minister to ensure that this genuine situation whereby the man’s name has been put back on the deeds of the house is sorted out,” the Sinn Féin TD continued.
A third case he raised was that of a family in mortgage distress who have been offered a lump sum of €10,000 by their bank to hand over their house.
The family is doing its best to work with the bank to pay a certain amount to cover some of the capital and all of the interest of the bank loan yet the bank is offering them €10,000 to get out of the house. If the family was vulnerable and there was addiction to drugs, alcohol or gambling there is no doubt there would be a serious temptation on the part of the family to accept the money but in a number of months they would be homeless.
He said it is important that the government “focus on that cohort of individuals who are being held to ransom through no fault of their own and are being forced into homelessness”.
In his own speech on the bill, Minister Flanagan acknowledged that mortgage arrears remain high, but noted that both home mortgage arrears and repossessions are “falling significantly”.
“We can see a clear impact of government measures to help borrowers in home mortgage arrears to get solutions into place. There is no room for complacency and there is much more to be done in that regard. Important further measures already in train under the government’s action plan for housing and homelessness include recent and continuing changes to the mortgage-to-rent scheme to extend its availability, particularly for borrowers in rural areas,” the minister said.
“This remains a priority for government. Arrears and repossessions are falling steeply, but they are still too high. We are determined to reduce them further. We have taken action and we continue to take action.”