Wednesday 22 November 2017

Banks fail to ask about other loans

Charlie Weston

Charlie Weston

LARGE numbers of homeowners in mortgage arrears are not being asked about other debts when they hold discussions with their bank.

This is despite the average homeowner in trouble having at least four other debts on top of a mortgage.

One-third of cash-strapped householders were never asked about other borrowings by their lender, a new Central Bank report reveals.

The finding emerged from a Central Bank survey on how banks are treating people in arrears. Some 180,000 mortgage accounts are in some form of arrears or have had the monthly repayments reduced. The average mortgage arrears is €40,000.

The failure of banks to work out what other debts homeowners have was evidence of a huge level of incompetence, said David Hall, of the Irish Mortgage Holders' Organisation.

But a spokesman for the Irish Banking Federation denied banks were failing to get to grips with the mortgage problem, adding that discussions about modifying a mortgage would involve borrowers filling out an eight-page standard financial statement.

Meanwhile, Tanaiste Eamon Gilmore has become the latest senior figure to criticise the banks for failing to help struggling mortgage holders.

The lack of speedy action on their part has been blamed for increasing stress on families, preventing them from spending in the economy and stalling the recovery of the property market.

Mr Gilmore said the Government had passed personal insolvency legislation and set up an insolvency agency.

"I have to say we are not happy with the response of the banks," he said.

Irish Independent

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