News & Events
Peter McVerry Trust, the national housing and homeless charity, has said it is concerned by the timing and impact of moves by Irish financial institutions to sell off large numbers of distressed mortgages. The charity said while it understood the pressures on financial institutions to improve their performance, the sell-off must take into account the impact on the people living in the homes linked to the distressed mortgages, as well as the broader impact on the housing system and efforts to tackle homelessness.
The charity’s CEO Pat Doyle said: “We understand the need for banks to have better-performing loan books but our concern right now is the timing of these moves and the impact it will undoubtedly have on people who currently live in these properties.”
“Peter McVerry Trust is worried that the bulk-sale of distressed loans may cause disruption to a housing system that has not yet found stability since the financial crash. We believe that now is not the time for this to happen because not only will it have a negative impact upon people living in these homes but also on broader efforts to tackle homelessness and stabilise the housing system.”
Disruption to the Housing System.
“This morning’s announcement by Ulster Bank that it is to offload 7,000 distressed loans added to PTSB’s larger sell-off of 18,000 is concerning because those 25,000 homes represent a much larger number of home occupiers, be they homeowners or tenants in Buy-to-Let properties.
“Given that this sell-off involves distressed mortgages, it is expected that the loans are going to be sold to financial entities who are more likely to move to repossess the properties. Even if these funds do take every appropriate step in line with legislation it would not be a shock to see 10% of these homes repossessed – that’s 2,500 families pushed into the rental sector or the homeless sector, and neither sector can cope with that influx.”
Every Effort to Prevent Home Repossessions
Mr Doyle said he hoped that whole Government would take a holistic view on this issue and give strong consideration to the broader impact on society and the housing system.
“Our view is that concerns for the financial sector take precedence over the views and needs of other sectors like housing and homelessness. The decision has to be one which the whole of Government is involved in.”
“We know that the Government is committed to tackling the housing and homeless crisis and are ramping up spending of capital programmes under Rebuilding Ireland. However, much of the hard work on housing delivery and homelessness could be undone if a situation arises where we see hundreds of families and individuals pushed towards homelessness at this time.”
“It is important to keep in mind that rental prices are at record highs and the people that are pushed out of repossessed properties are most likely families who were unable to pay their mortgage and will find it very difficult to pay market rents if they are able to find a property to rent in this market.”
“It will also see existing tenants of Buy-to-Let properties being forced to leave their homes and face a challenge to secure a suitable and affordable rental property in the current market.”
Likely Increase on Record Homeless Levels
“Our biggest fear is that this latest bulk sell-off of distressed loans could set off a chain of events which leads to more people coming into homelessness at a time when services and supports are stretched by a record need. In order to stop such a scenario becoming a reality, and we need to prevent owners and tenants losing from their homes.”