John McGuinness (Carlow-Kilkenny, Fianna Fail)
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188. To ask the Minister for Finance if he will establish a benevolent friendly fund supported by Government bonds or funding to allow the banks to transfer all distressed loans to the fund, in order that individual work outs can be achieved over a longer period of time based on affordability or whereby tenancy agreements can be put in place with the goal being that families would not be evicted or lose their houses; if the same discounts provided to vulture funds will be provided to this friendly vulture fund by the State owned banks; if he will ensure that family homes will not be part of the sale of debt to vulture funds; and if he will make a statement on the matter. [9839/17]

Michael Noonan (Limerick City, Fine Gael)
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The Mortgage to Rent Scheme (MTR) is managed by the Department of Housing, Planning, Community and Local Government. The scheme is targeted at households with unsustainable long term mortgage arrears who qualify for social housing. Under the scheme borrowers can switch to renting their home as social tenants. Under the Action Plan for Housing and Homelessness it was committed to review the scheme. On 8 February 2017, the Minister Housing, Planning, Community & Local Government announced significant changes to the scheme. This MTR review covered issues such as changes to the eligibility criteria, the financing of the scheme, administration and communications. The review sets out a series of actions that will make MTR quicker, more transparent and more accessible for borrowers in mortgage distress.  The changes are designed to increase the number of households availing of the scheme.

The MTR Review also announced the testing of alternative funding models for the scheme to deliver volume.  The Housing Agency will work with a number of financial entities who have come forward with an interest in working with the MTR scheme to progress a minimum of 200 units based on the new arrangements.  The objective is to explore what is available within the current market and to determine if this alternative model will benefit a greater number of households. 

It is to be hoped that the test of the alternative MTR model will be positive and will result in a further scheme to aid as many distressed borrowers as possible to remain in their homes through a leasing arrangement.

In conclusion, I must point out that as Minister for Finance, I am unable to intervene directly in the commercial decision-making process of any financial institution, which is a matter for the management boards of each institution.  Separately, however, I would refer the Deputy to the Central Bank Report on Mortgage Arrears, published on my Department's website on 16th December, which noted inter alia that:

- There is a broad range of available restructures offered and delivered by both bank and non-bank entities depending on the individual circumstances of the borrower;

- Since the June-2013 peak, considerable progress has been made in addressing mortgage arrears primarily through the use of restructures, rather than loss of ownership;

- The use of a range of restructuring options for distressed borrowers increases the potential for them to remain in the primary residence;

- Overall, there is strong evidence that banks and non-banks are looking to exhaust available options before moving into the legal process.