Denis Naughten (Roscommon-South Leitrim, Independent) | Oireachtas source

I welcome the opportunity to speak on the Bill. I wish to raise an issue that is not covered in it and address what I believe is a deficiency in financial and mortgage legislation in this country. As we know, on average, one person was killed on an Irish farm every fortnight last year. Every second day, one person was killed on Irish roads in 2014. For each one of those individuals, there are also other individuals who, in the prime of their lives, have had their mental capacity diminished, some literally overnight, because they have been involved in a road traffic accident, a farm accident or for some other reason. This, of course, has a devastating personal impact or an impact on their immediate family. However, it can also lead to huge financial hardship for families.

As the Minister knows, banks make the issuing of a mortgage conditional on the applicants - usually a couple - taking out house insurance and life insurance. This is not because the bank is concerned about the long-term financial stability of that couple but purely to protect its own investment should anything happen. For example, if one of the couple were to die suddenly, the bank's security and asset is intact and the mortgage is cleared. In some countries it is routine that, as part of the mortgage application, the applicant must also verify they have made a will and have made provision for enduring power of attorney. Taking out a mortgage is a huge financial step, probably the biggest financial commitment a person is going to make. I believe it should be a requirement that people make a will at the issuing of all mortgages and that they make provision for enduring power of attorney in order to safeguard themselves and their families in the long term.

In countries such as Canada, it is compulsory that this specific provision has been put in place when drawing down a mortgage. The reason for that is very simple, namely, the potential for a devastating financial impact on individual families.

In many cases it causes extreme financial hardship for those left behind. All of us here have personal experience of cases where serious financial hardship has been caused to young families because an individual has died suddenly intestate. A case I remember from a number of years ago involved a constituent - a widow with five young children. The couple had taken out a small mortgage and bought a home that required work. The husband was a handyman and intended to do much of the work himself, but he dropped dead from a massive heart attack at the age of 45. The small mortgage was cleared on his death, but because the man died intestate his estate was left in financial limbo.

The widow was left in a situation where the mortgage with the bank was sorted out, but she could not raise a loan to complete the work on the house. There was no ceiling in the sitting room or kitchen and a partly completed extension to the side of the house brought the wind running through the house from one side to the other. This woman had five young children, but she could not draw down a mortgage because she did not have title to the property because her husband had died intestate. This widow was left in a serious financial crisis. She was stuck with an unfinished property which was worthless to her and had to try to find accommodation for herself and her children.

I urge the Minister to ensure that as part of this legislation a new condition be placed on the transfer of any loan book to ensure that all couples verify that they have made a will and made provision for enduring power of attorney. Approximately one family every day in this country finds itself in these particular circumstances, where a person dies suddenly or is left mentally incapacitated and cannot properly function. While it is a difficult situation when a person dies, at least the mortgage is cleared on the family home. However, is a person is mentally incapacitated, the mortgage is not cleared and the other partner cannot dispose of assets or property. This causes significant financial hardship for many people.

I urge the Minister to make provision for this in this legislation. I urge him to introduce a condition requiring that for all new mortgages issued from now on, couples must make a will. I urge him to require that they make provision for any children out of the relationship and that they make provision for enduring power of attorney. Unnecessary financial hardship is being caused due to the current position. Enduring power of attorney is a simple provision and it should be put in place. It has been put in place in countries like Canada and many other parts of the world. Not only would these provisions protect families from severe financial hardship, they would also save the State from having to provide for them. In many cases currently, these families have to fall back on the supports and resources provided by the State because they cannot access their assets due to the estate being left intestate. I hope the Minister will consider this in the context of this legislation.

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