Bernard Durkan (Kildare North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

83. To ask the Minister for Finance the extent to which his Department continues to monitor the progress with which lending institutions are making adequate efforts to meet the requirements of borrowers with particular reference to the need to protect the family home; and if he will make a statement on the matter. [41762/13]

Bernard Durkan (Kildare North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

89. To ask the Minister for Finance if he is satisfied that all lending institutions are entering into meaningful discussions with borrowers with a view to ensuring that such borrowers remain in their family home while making reasonable arrangements to meet their commitments in the circumstances with particular reference to their current income as opposed to their income when undertaking their borrowings; and if he will make a statement on the matter. [41768/13]

Bernard Durkan (Kildare North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

93. To ask the Minister for Finance the extent to which his Department has monitored the total number of family home repossessions in each of the past three years to date; and if he will make a statement on the matter. [41772/13]

Michael Noonan (Limerick City, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I propose to take Questions Nos. 83, 89 and 93 together.

The Government's strategy to assist those in mortgage difficulty is built around measures in four distinct areas - Personal Insolvency, a Mortgage Advisory Service, the Mortgage to Rent Scheme, and Engagement with the Banks, and considerable progress has now been achieved across this agenda.

The implementation of sustainable mortgage arrears strategies and solutions by individual banks for their distressed customers, with Central Bank oversight, is a key element of the overall framework to address the mortgage arrears problem. The Deputy will be aware of the Central Bank's initiative announced last March, which set time bound and measurable targets for the main banks, requiring them to systematically address their arrears book. This is a very important step to resolve the impasse on arrears. The Central Bank initially required the main mortgage lenders to propose sustainable solutions to 20% of mortgages that are in arrears (of over 90 days) by end June. The target rises to 30% by the end of September, to 50% by the end of December 2013 and 70% by end of March 2014. The Central Bank is now also requiring banks to agree sustainable solutions with 15% of their customers by the end of this year and 25% of their customers by the end of March next year. The Central Bank has informed me that it will monitor and audit the performance of banks in relation to the targets and, crucially, will also assess whether the modifications provided are in fact sustainable solutions.

The Central Bank's Code of Conduct on Mortgage Arrears (CCMA) also provides a strong protection framework for borrowers who engage with their lenders. Under the CCMA lenders are required to proactively engage with their co-operating customers in order to help them address the situation - they must carry out a full assessment of the borrower's situation based on the Standard Financial Statement and each case must be examined on its individual merits and when a lender makes a sustainable forbearance offer to a borrower, the affordability assessment of the borrower needs to be based on both their current and prospective future servicing capacity for all borrowings Lenders are required to explore all their options and where they do not offer an alternative repayment arrangement they must inform the borrower of the reasons for this and what alternatives are available.

The 'Keane Report' indicated that, given the recourse nature of mortgages, personal insolvency reform and in particular the introduction of new more accessible insolvency resolution frameworks, were essential for the resolution of the mortgage arrears problem. The Personal Insolvency Act is now law and the introduction of this Act should be a catalyst to incentivise banks to reach an agreed solution with individual borrowers in resolving mortgage arrears cases. The Insolvency Service of Ireland is already dealing with the first cases that have been submitted.

The Mortgage Advisory Service, which is an extensive independent mortgage advice framework has been put in place by the Minister for Social Protection and comprises of an enhanced website, a Mortgage Arrears information helpline, and the provision of free independent 'one-to-one' professional advice to borrowers when considering a long-term forbearance or resolution offer from their lender.

In addition, the Minister for Housing and Planning has put the 'mortgage-to-rent' scheme on a nationwide basis. Protecting the home of the most distressed mortgage holders through a 'mortgage-to-rent' scheme where the ownership of the house passes to an Approved Housing Body is a key housing support for those with distressed mortgages. The existing owner then becomes a social housing tenant. This option is now available in appropriate cases and will be of benefit to low income families whose mortgage situation is unsustainable to allow the family to remain in their home.

The Deputy will be aware that the Central Bank compiles and publishes quarterly mortgage arrears, restructures and repossession statistics for both primary domestic homes (PDH) and buy-to-let (BTL) mortgages and my Department closely monitors these statistics closely. According to these Central Bank statistics, from Q3 2009, over 2,000 PDH properties have been taken into possession by the regulated lenders to Q2 2013 inclusive. Full details are available on the Central Bank's website at www.centralbank.ie.

The mortgage arrears problem is a major problem that needs to be resolved for the long term economic and social health of the country and the Government has now put in place a comprehensive strategy to tackle the problem.