PT SB agrees write-downs allowing stricken owners to rent back their houses
UP TO 1,000 financially stricken mortgage-holders could end up staying in their homes by renting them back at low rates.
Permanent TSB has agreed a deal with David Hall’s iCare housing body that sees people who are in deep mortgage arrears selling their homes and renting them back.
The bank has agreed to huge write-downs on the value of the properties as part of the agreed mortgage-to-rent scheme, the Irish Independent has learned.
It is the second bank to sign a formal deal with iCare, after AIB inked a similar agreement last year.
Already iCare has agreed to buy 100 homes for families that are in mortgage arrears.
Under the terms of the deal, iCare will buy the homes at a discount and rent them back to the former homeowners at rates they can afford.
The people concerned are facing repossession. If they get accepted for the scheme, they will get their residual debt written off.
Those who get into the scheme will have to qualify for social welfare payments, and the properties cannot exceed certain values.
Not-for-profit housing body iCare will buy the homes of those in arrears and rent them back at levels in line with social welfare housing rents.
Some 92pc of the rent is paid by the local authority to iCare, with the resident paying an average of €45 a week.
It is understood that Permanent TSB is to offer discounts of around 35pc on the property sales to iCare.
“For Permanent TSB customers an option now exists, for those who qualify for mortgage to rent, to remain in their homes, have their residual mortgage debt written off and have the option to buy their home back in the future for a price that is discounted from today’s market value,” Mr Hall said.
He said the solution was the most significant one he had been involved in over the past seven years that he had been advocating on behalf of those in mortgage arrears.
“For people who are in trouble with their mortgage I would encourage them to contact us, free of charge. Solutions exist that allow families to get their lives back and allow them to stay in their home.”
Permanent TSB chief executive Jeremy Masding said the initiative would play a limited role in reducing the bank’s non-performing loans.
Customers of AIB, EBS and Haven who are in mortgage trouble already have the option to do similar deals if they meet the criteria.