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Friday 19 September 2014

Home debt write-offs by bank welcomed

Charlie Weston Personal Finance Editor

Published 31/05/2014 | 02:30

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Permanent TSB has moved to write off the debts of those unable to meet mortgage repayments when they hand the properties back to the bank
Permanent TSB has moved to write off the debts of those unable to meet mortgage repayments when they hand the properties back to the bank

ANTI-eviction campaigners have welcomed Permanent TSB's move to write off debts for those unable to meet their mortgage repayments when the properties are handed back to the bank.

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But the revelations in the Irish Independent that the bank was prepared to do a deal on any residual debt have prompted criticism from politicians.

Permanent TSB is testing the new scheme, which could offer a way out of a debt mire for thousands of people.

Over-stretched borrowers are to be given a chance to clear their debts if they sell their properties and pay what they can of the outstanding balance.

The bank is prepared to write off much of the balance owed when the property is sold if a deal is reached on paying back some of the outstanding amount.

This is a the nearest there is to "jingle mail" in this country. That is the US phrase used to describe over-burdened borrowers handing back keys.

Now the Dundalk-based Anti-Evict Ireland group has welcomed the scheme. The group says it campaigns to keep victims of the property and bank bubble in their homes.

John Conway of the group said the new offer was step in the right direction, but he urged the bank to go further and allow financially-distressed people to stay in their homes through a write-off of mortgage debt.

And Fianna Fail's Michael McGrath said the Permanent TSB initiative highlighted the piecemeal approach from all the banks to the mortgage arrears crisis

New Beginning, which provides personal insolvency and bankruptcy services for a fee, said Permanent TSB was attempting to give those in mortgage arrears a deal to avoid them declaring themselves bankrupt, or opting for an insolvency arrangement.

Irish Independent

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