Robert Dowds (Dublin Mid West, Labour)
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510. To ask the Minister for Environment, Community and Local Government the policy for persons, who have taken out a county council loan towards a housing mortgage and who have difficulty completing repayments due to changed economic circumstances. [7065/15]

Alan Kelly (Tipperary North, Labour)
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My Department issued revised guidelines to local authorities for dealing with mortgage arrears within the local authority sector in June 2014. Dealing with Mortgage Arrears – A Guide for Local Authoritiesis available on my Department’s website by clicking on the following link:.

On foot of the recommendations of the Keane Report on mortgage arrears, my Department launched a Mortgage to Rent scheme on a pilot basis in February 2012. This scheme was extended nationally in June 2012, targeting those low income families whose mortgage situation is unsustainable and where there is little or no prospect of a significant change in circumstances in the foreseeable future.

It is fully recognised that people with mortgages borrowed from local authorities have been affected by issues such as unemployment and possible negative equity over the last number of years. The scale of the mortgage arrears problem amongst local authority borrowers necessitated the introduction of a Local Authority Mortgage to Rent scheme in February 2014 in line with the MTR Scheme in relation to mortgages from private institutions introduced nationally in June 2012.

The Local Authority Mortgage to Rent (LAMTR) scheme, which was rolled out nationally in February 2014, allows local authorities to offer the mortgage to rent scheme to local authority mortgage holders with unsustainable mortgages. This enables families to stay in their home and their established community. Surrendering the ownership equity in a home is a very difficult decision for a family; however, the mortgage to rent option does provide families with stability and continuity, after an often long period of financial turmoil. Ownership of the home transfers to the local authority and the family pays a differential rent.

LAMTR is just one of a range of short term and long term solutions available to local authority mortgage holders in arrears. The Mortgage Arrears Resolution Process, already in place in respect of commercial mortgages, is now being implemented across all local authorities. In cases of acute mortgage distress, homeowners also have the option of seeking to avail of the legal process now also in place to deal with personal insolvency. The most important step any family in arrears can take is to engage early with the Arrears Support Unit of the local authority. Solutions are available and advice should be sought as early as possible.