VITAL paperwork for Irish Nationwide home loans are incomplete or missing, with industry sources speculating that as much as 30 per cent of the liquidated bank's mortgage book is "deficient".
The revelation comes as the Government tries to sell Michael Fingleton's former building society's €1.8bn home loan book to the highest bidder. However, serious "issues" over incomplete title deeds and missing paperwork are understood to have complicated the process.
More than 13,250 residential mortgages were moved to the IBRC after it took over Irish Nationwide's business in 2011. When the IBRC was liquidated a year ago, the building society's residential loan book, along with office furniture and paintings, were put up for sale on behalf of the State by the special liquidators. A spokesman for the IBRC's special liquidator declined to comment on the sale of the Irish Nationwide mortgage loan book. Informed sources acknowledged that there were issues with the paperwork on Irish Nationwide home loans but denied that as much as 30 per cent of the loan book was tarnished.
The development comes as the Government faces mounting pressure from residential mortgage holders, who say they are being "treated like chattels" by the State. They fear that if home loans are sold to foreign investors they will lose the Central Bank protections on mortgage arrears that are enjoyed by other Irish mortgage holders.
Denise McCormack of IBRC Mortgage Holders, a lobby group for former Irish Nationwide customers, said residential mortgage holders should be treated in the same way as IBRC's commercial clients. The Sunday Independent understands that the IBRC had set up a dedicated team to prepare the Irish Nationwide loan book for sale, but the process was stopped in its tracks after the sudden liquidation of the bank last year.
The IBRC team found that crucial residential mortgage documents were absent or deficient, seriously diluting the value of the bank's security over properties on its books.
As this could have affected the value of the loan book, the IBRC began contacting mortgage borrowers to correct deficient paperwork.
"We needed to perfect the IBRC's security as much as possible before we put the Irish Nationwide book up for sale," a source familiar with the IBRC process told the Sunday Independent.
The special liquidator resumed the process of checking the title and documents attached to the residential loan book to prepare it for sale. The liquidator was due to receive binding bids for the mortgage loan portfolio at the end of last month.
Meanwhile, the Sunday Independent has learned that prized IBRC premium rugby tickets were donated to charity by the liquidators, Kieran Wallace and Eamonn Richardson. This season's Six Nations rugby tickets, block-bought by Anglo Irish Bank during the boom for €140,000, were given to charities to be sold at face value or auctioned.