Finally, it’s D-day for bank veto
Bid to help homeowners
LONG-awaited plans to curb the banks’ veto on agreements that would allow struggling mortgage-holders to sort out their home debt problems will be unveiled today.
The crucial measures to help beleaguered householders will be launched by both Enda Kenny and Joan Burton, as Government ministers set out to show their eagerness to take on the banks.
However, it emerged last night that the package of measures to address the mortgage arrears and repossession crisis – which have to be first approved by the Cabinet this afternoon – have yet to be agreed.
‘Not everything has been tied down,’ a Government source said last night.
The range of measures is certain to include a dilution of the bank veto in the personal i nsolvency process through a new oversight mechanism.
There will also be an expansion of the mortgage-to-rent scheme, which has so far proven to be too narrowly focused. As revealed by the Irish Daily Mail last week, there will be a form of personal or household examinership, hitherto reserved for companies.
It will allow homeowners to appeal to the courts if a bank rejects a new mortgage deal. The court can then seek professional advice, and the judge’s decision would be binding.
There will also be an expanded role for the Mortgage Advice and Budgetary Service, which has proven to be a success across the country, despite operating on a shoestring hitherto.
An English charity named Stepchange will be asked to operate as an honest broker between home loan customers and their banks or lenders, according to reports.
Changes in the mortgage-to-rent scheme – whereby householders can sell either a slice or all of their arrears-plagued homes to their local authority – will be expanded so that it can be applied to more expensive homes. And councils and housing associations could get greater funding to boost the scheme.
But it seems the hoped-for cut in the bankruptcy period, from three years to one, to match the British regime, will be kicked into touch.
It will now go to the Dáil finance committee for discussion, which is expected to prevent any action before the general election – even though the committee is asked to report ‘if possible’ before the summer recess.
Justice Minister Frances Fitzgerald has written to the committee chairman, Fine Gael TD Liam Twomey, asking him to study a Private Member’s Bill on the subject proposed by Labour deputy Willie Penrose.
Ms Fitzgerald stated: ‘In my view, it would be very worthwhile if we could take a good look at this issue... in a forum where it can be examined on a cross-party basis, perhaps also consulting with relevant stakeholders.’
Measures t o encourage more engagement with the Insolvency Service of Ireland are likely to involve increasing the ceiling for access to the debt relief notice process from €20,000 to €30,000. Another option Finance Minister Michael Noonan has raised is to give the Central Bank powers to set standard variable rates over the heads of bank bosses – but the Central Bank does not want the role.
Ministers and senior officials from the Departments of Justice, Finance and the Environment were still working on the proposals, aimed at helping the tens of thousands struggling to meet their mortgage repayments so that they can keep their homes.
Top officials involved include Enda Kenny’s special adviser Andrew McDowell, Michael Noonan’s special adviser Paul Bolger, and head of banking and assistant secretary general at t he Department of Finance John Hogan.
‘Not everything has been tied down’