Mortgage sales to 'vultures' defended
Banks have defended the sale of non-performing mortgages to 'vulture funds' and dismissed claims of large-scale repossession of family homes.
Banking and Payments Federation Ireland insists borrowers retain consumer protections when their loans are sold, and disputed claims there will be a tsunami of repossessions by vulture funds that have bought mortgage books.
The banking body said only 9,500 homes have been repossessed since 2009.
It said the repossession rate here was low by international standards and has fallen "at the very time when portfolio sales to funds have been increasing".
Head of the federation Brian Hayes claimed a number of myths had grown up around the sale of mortgages in arrears to funds.
David Hall of the Irish Mortgage Holders Organisation has been vocal in the past, claiming funds that take over mortgages offer a limited number of mortgage restructuring options, and that funds are more inclined to repossess properties than mainstream lenders.
But Mr Hayes has issued a report which "tackles head-on various false claims made about the process".
He said: "The sale of non-performing loans (NPLs) to third-party investment funds provides benefits for banks and protection for borrowers."
Mr Hayes said banks have made huge progress in reducing the levels of NPLs.
He said this was not just good for the banks, but for the wider economy, which depends on banks for personal and business lending.
In response, Mr Hall said: "The language used by the banker ... spokesperson in dismissing the fact that so far 9,500 families/individuals have lost their homes is typical of the contempt by which banks and funds view those who can't pay their mortgage."