John Browne (Wexford, Fianna Fail) | Oireachtas source

I welcome the opportunity to say a few words on the motion tabled by our spokesman, Deputy Michael McGrath. It gives us an opportunity to highlight the problems faced by people with mortgage arrears. The number in mortgage arrears continues to rise. There were 143,000 family mortgage accounts in arrears at the end of June 2013 and some 57,000 family home mortgage accounts have been in arrears for more than one year. Last week, the Oireachtas Joint Committee on Finance, Public Expenditure and Reform met representatives of the banks and they spoke about the threatening letters that the latter sent out. I am sure all politicians meet in their clinics people who have received threatening letters and who are begging for support and help when negotiating with the banks. Obviously, the threatening letters are adding seriously to the burdens already placed on families with mortgage arrears. The families are experiencing severe hardship and stress, causing depression, family break-up and, in some cases, suicide. A resolution needs to be found to deal with the problem.

Banks are not being very helpful; they issued the letters. Many people making interest-only mortgage repayments are meeting their commitments but are now getting harassed by the banks, which are stating that is just not enough. The banks want the full payment, despite the fact that people are not in a position to make full payments. If families are meeting agreements to make interest-only payments on a monthly basis, they should be allowed to continue in that regard until a reasonable and final solution is found. Interest-only payments are certainly a way forward in that they help the mortgage holder, who may have lost his job or have a lower income than he or she had previously. Obviously, different banks have their own ways of dealing with customers. As I said, these include frightening letters and abusive and demanding phone calls. People do not have the means of meeting the mortgage payments.

It is time that the banks seriously considered finding solutions. Threatening letters are one thing but finding a long-term solution is what people are looking for. Split mortgages are certainly a way forward. We need to consider mortgage repayments that could be spread over two generations. This scheme was introduced in Canada some time ago and was found to be very reasonable.

Many people who come to my clinic are seeking debt relief or a write-down of the loan so they can make the repayments. Those who paid €200,000 or €300,000 for their houses now find themselves no longer in a position to make the repayments agreed when the mortgages were first obtained, perhaps because of job losses or reduced wages. In many cases, there was reckless lending by the banks. Many people should certainly not have got loans in the first instance based on their income. Some never had a hope of making their repayments. Banks have a certain responsibility in this area. They made loans available to people who were never in a position make repayments. This was the position with 100%, 110% and 120% mortgages, which were ridiculous.

The time has come for the banks and the Government to take action and for solutions to be proposed by the various interested bodies in order to help people to remain in their homes. Keeping people in their family homes makes for good social policy and makes sound financial sense. I compliment Deputy Michael McGrath on tabling the motion. It affords Deputies on all sides of the House an opportunity to put forward ideas and suggestions. I hope we can come forward with a reasonable solution for families who are finding it very difficult to make ends meet and make repayments at present.

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