Martin Ferris (Kerry North-West Limerick, Sinn Fein)

Mortgage arrears and house repossessions present an increasing problem for tens of thousands of families. According to the most recent statistics, 5.7% of residential mortgages, or 44,508 mortgage accounts, are in arrears for longer than 90 days, an increase of 25,000 since 2009. Given the recent European Central Bank interest rate increases, with current levels of unemployment and wage cuts, this figure is certain to increase further, perhaps dramatically.

My party has proposed measures that could be taken to address this problem. Last year a group of respected economists urged the banks to introduce some form of debt resolution and accept part of the losses as their own. While I note the expert group on mortgage arrears did not go that far, individual members have called for similar measures. It is now time to consider writing off some of the negative equity on properties which are principal family homes where people are in arrears on mortgages that are clearly unsustainable. Mortgages should be calculated on the basis of current house values rather than the price at the time of purchase, when unscrupulous lenders gave massive mortgages to people who could not repay them. This would constitute not only a massive relief for those suffering the burden of unsustainable mortgages through no fault of their own, but it would also recognise the significant changes that have occurred in the property market and banking sector in the past four to five years.

Last Monday morning a young couple, Sharon and John-Patrick, with two young children came into my constituency office in Tralee. Several years ago they procured a mortgage to the value of €220,000 from Start Mortgages, of which they have drawn down €160,000 to build their home. However, they found it difficult to meet the repayments of €1,300 or more per month. They told Start Mortgages about their difficulties and indicated they were prepared to pay €400 per month to cover their mortgage. Last Friday in the court in Tralee Start Mortgages secured repossession of the house and the inevitable eviction of the two people concerned. That is happening throughout the country. It is happening to young couples who had employment secured loans and built their own homes. Most of those people are now in considerable difficulty. More than 90,000 people are in difficulty at this point.

A proactive approach must be taken to try to deal with this. What is happening is illogical in that people evicted as a result of the repossession of their homes by unscrupulous lenders, including the banks, inevitably find themselves on local authority housing lists. They must secure rent allowance from the HSE to rent a house and the taxpayer and the State are paying for that. We need to be imaginative and firm in how we approach this.

There are unoccupied houses throughout the country which have been taken over by the banks and mortgage lenders. I suggest State bodies, in particular local authorities, working together might be able to secure these houses by buying them at the current market value, rent them to the previous owners and give them the opportunity when the economy recovers, hopefully as a result of a progressive job creation programme when people will find work again, to meet mortgage repayments and live in their dream houses which they bought initially.

In regard to the two people about whom I spoke, one went public this morning on Radio Kerry which was inundated with calls from people throughout county who were in a similar position. Together we must stand up to sub-prime mortgage institutions which are effectively vultures. I cannot think of a word bad enough to describe them other than to say they are vultures. They penalise people even if they are a few days' late with their repayments. Collectively we must stand up and say that is wrong as we must stand up to the banks. We now own the banks so we should be in a position to do everything in our power to help people in difficulty.

We must be cognisant of the reality of today. The reality is that people who purchased houses between 2004 and 2008 did so at totally inflated values. That must be taken into account in order that we can address this terrible grievance.

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