Kieran O'Donnell (Limerick City, Fine Gael) | Oireachtas source

I welcome the Bill, which arose from discussions in the Joint Committee on Finance, Public Expenditure and Reform on IBRC loans being sold to unregulated entities. Borrowers are entitled to continue to enjoy the level of protection afforded to them when they took out a loan, regardless of which entity is holding their loan.

People throughout the country, including small mortgage holders and SMEs, are entitled to that level of protection.

I hope we do not have a situation where credit unions are required to sell their loan books outside the credit union movement and that some process can be found to ensure they stay within the family of credit unions. There is a great affinity with the way the credit union movement has operated throughout the country, so I hope this could be looked at and taken on board.

Another issue that arises is that this is supposed to be a protective measure for people who have mortgages as well as those with personal, household and SME loans. I hope there is not the indirect by-product that it becomes a licence for various holders of loans to sell on those loans to unregulated entities. While such bodies will be regulated, this is something that needs to be looked at to ensure that while we live in a market economy, there is some element of control which ensures the loan books are sold to entities that are of good standing and have a history of dealing with consumers in a proper way.

On a broader issue, countries around the world are now borrowing money on a much longer-term basis. Ireland successfully launched a 30-year Government bond yesterday. In keeping with that mood and frame of mind, we need to consider the banks themselves extending mortgages for a longer period. For example, if a person on a 20-year mortgage is under enormous pressure, we need to look at lengthening the period over which the mortgage can be paid. While this is happening it should become more commonplace. I still hold that, in Ireland, the family home is sacrosanct and most people would like to remain in it. Nonetheless, we have seen an increase in repossessions by financial institutions. While some people get an initial sense of relief that the burden has been lifted from them, in many cases these people then get into the rental market, which proves to be very costly and means there is no future for many in terms of being able to own a property.

In summary and in conjunction with what is being proposed here, we need to ensure mortgages are rescheduled over a much longer period to ensure people can remain in the family home. We need to ensure credit union loans are kept within the credit union movement itself rather than being sold outside those organisations. We need to ensure this legislation, which is a protection measure, is not abused by institutions selling their loan books to bodies that may not have a particularly good reputation in terms of how they deal with people's loans over a period.

The Bill is very much to be welcomed. It will provide security for people who take out a loan and ensure the normal protections that are in place when a loan is taken out with a regulated entity will apply. The bodies that were unregulated heretofore will now be regulated, although it is very important that resources are put in place to ensure they can be properly regulated. I commend the Bill to the House.

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