Maureen O'Sullivan (Dublin Central, Independent)
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To ask the Minister for Finance his plans to promote the incentive involving negative equity mortgages offered by Bank of Ireland and other banks whereby, a home owner could sell their house and move to a more suitable house, adding their savings to the purchase price and taking the mortgage with them at its existing level; the reason this incentive is not being rolled out on a greater scale in order to help curb problem with mortgage arrears crisis here; and if he will make a statement on the matter. [49458/12]

Michael Noonan (Limerick City, Fine Gael)
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The Central Bank has advised me that some lenders are already offering this product, or about to, but to date none are actively marketing it. Other lenders have committed to reconsidering the issuing of such products. The decision to introduce a negative equity type product is a matter for each mortgage lender. However any institution offering such a mortgage facility may do so only in accordance with criteria set out by and with the prior approval of the Central Bank. The Central Bank also advised me that, following the issue of the report of the Inter-Departmental Mortgage Arrears Working Group in September 2011, which included a recommendation on trade down mortgages, several lenders contacted the Central Bank with regard to offering negative equity mortgages. This included trade up, trade down and trade down where the customer was in arrears. While the provision of negative equity mortgages may facilitate people moving homes and generate transactions in the housing market, it is not expected that there will be a large take up of this product. All sales must comply with the affordability and suitability provisions set out in the Central Bank’s Consumer Protection Code.

I expect that the Central Bank will continue to assess the impact of these measures as part of their general oversight of the banks’ activities in the mortgage market.