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Monday 22 September 2014

Michael Noonan hits out at TDs 'frightening people' over loan sale

Fionnan Sheahan Group Political Editor

Published 21/02/2014 | 02:30

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The Irish Nationwide loan book is being sold off
The Irish Nationwide loan book is being sold off

FINANCE Minister Michael Noonan has warned that people in planning rows could buy their neighbour's home loan if individual mortgages were put up for sale by banks.

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As concerns grow about the sale of Irish Nationwide mortgages on the open market, Mr Noonan shot down the idea of individual homeowners being able to buy their mortgages when such loan books go up for sale.

The minister has also accused opposition TDs of making "exaggerated claims" and frightening homeowners on the sale of the 13,000 Irish Nationwide mortgages.

The special liquidator of IBRC – the remnants of the former Anglo Irish Bank and Irish Nationwide – is selling the mortgage book.

Mr Noonan dismissed suggestions of mortgages being sold individually to the homeowners themselves or anybody else.

"If it were to sell mortgages individually, rather than in loan books, it could result in a mortgage holder's neighbour, who had a row over planning permission, buying the mortgage.

"Alternatively, someone with whom the mortgage holder is in dispute or another family member, in circumstances where the family is not pulling together, could come in and buy the mortgage. Therefore, it is not a solution," he said.

Mr Noonan said the loan books had to be sold collectively to establish a value in the market and get the best return possible for the taxpayer.

But the sale of the Irish Nationwide loans has led to fears about the treatment of mortgage holders by the new owners of their loans.

The Government is insisting that the sale will not change the mortgage contract.

Homeowners are worried about losing the protection of the Code of Conduct on Mortgage Arrears (CCMA).

Mr Noonan said TDs were "frightening decent people" with "widely emotional language".

"They are being wound up by TDs making exaggerating claims and frightening people to get headlines in the papers," he said.

Mr Noonan said the Government will make contact with the new owners of the loan book, adding: "We'll talk to them. We'll say, 'We expect you to comply. What's the story?'"

He said if additional terms were applied to the sale of the mortgages, it would diminish the value and could leave the Government open to legal challenge from other IBRC creditors. But if the required price is not met, the mortgages will be transferred to NAMA.

"NAMA will be mindful and apply best practices," he said.

Mr Noonan said the previous two buyers of mortgage loan books from banks had abided by the CCMA.

"I have no reason to believe this will not also be the case in relation to the sale of IBRC loans," he added.

Irish Independent

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