New Beginning needs to set record straight

WHEN New Beginning burst on to the scene four years ago, it was hailed as the saviour of thousands of homeowners. And, indeed, it has played an important role in finding solutions for many of those unable to pay their mortgages.

However, eyebrows were raised when it recently emerged that New Beginning intended to take on a more overtly commercial role, acting in effect as a mortgage broker and taking a lead from those Irish banks that have been selling off chunks of their loan books to foreign venture capitalists.

Our revelations today about advanced negotiations between New Beginning and a €2bn Maltese-based investment fund will fuel those concerns and will come as deeply unsettling news to thousands of homeowners who, in a time of great distress, sought help from what was at the time purely a lobby group.

In the first place, there remain far too many grey areas in the plan being put together by New Beginning and the USowned Arizun fund under which distressed mortgage-holders can rent their own homes back for a seven-year period.

Doubtless, many will seize on such a plan as a lifeline and will not look beyond that seven-year deadline. Equity will, however, be vested in the investment fund; there is no indication what will happen to those who, at the end of this period, are unable to buy the property back.

Concerns will be further heightened by our revelation that New Beginning is now being investigated by the Data Protection Commissioner over a very serious breach of trust, under which details of about more than 1,000 distressed homeowners were furnished to Arizun.

New Beginning only reported the breach more than three months after it had happened, and only after the Commissioner had been contacted by the Irish Mail on Sunday.

At the very least, much greater clarity is needed. And, if necessary, it behoves the Central Bank to step in and ensure that the rights of distressed homeowners are made clear – and fully protected.