Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

The Deputy is incorrect in his assertion that the Consumer Protection Act is ineffective. Under the Consumer Protection Act 2015, relevant borrowers whose loans are sold to third parties maintain the same regulatory protections they had prior to the sale, including under the various statutory codes, such as the consumer protection code and the code of conduct on mortgage arrears, issued by the Central Bank of Ireland and the Central Bank Act 2013 Regulations 2015, which came into operation on 1 July 2016. The sale of a loan does not change the terms of the contract or the borrower's rights and obligations under the original contract.

To respond briefly to Deputy Burton's question as part of my response to Deputy Doherty, Deputy Burton effectively asked why the banks did not cut deals with more people with impaired loans. The investment funds that buy impaired loans are in the business of cutting deals and do so frequently. I watched an RTE programme on the purchase of loans by investment funds and speaking during a panel discussion at the end of the programme, a very well-known individual, who is highly regarded by persons with impaired mortgages, stated it was his experience that it was much easier to deal with vulture funds to secure a reduction in the amount owed than it was to deal with the banks. The obvious reason is that if one can buy at a discount, one has much more head room to cut a deal.

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