Sinn Fein TD Peadar Toibin responding to news that Bank of Ireland has hiked its interest rate by half a percentage point said the move is guaranteed to push some mortgage owners over the edge, potentially taking people who are just meeting their mortgages into the volatile mortgage distress category.
Tóibín said the Government’s inability to make banks understand their debt to the Irish people was their biggest failure to date.
Deputy Toibin said:
“Early this morning, people began to receive letters from Bank of Ireland, with no prior warning, telling them their rate had increased by half a percentage point. For a €200,000 mortgage this equates to roughly €50 per month. That’s an additional €600 per year for people to find.
“People are struggling out there. They are struggling because politicians, banks and property speculators sold this state down the river and left ordinary people to pick up the tab. We have thousands of people in mortgage distress and this size of increase is the thing that will push some people over the edge, from those who are just about meeting their mortgage to those who are in mortgage distress. If the banks want to push people to the point where they can't pay any of their mortgage, they are going the right way about it.
“This Government has sat on its hands throughout this mortgage crisis, as the Moody’s report last week pointed out. Their reactions have been ineffectual and disproportionate to the size of the crisis.
“When the banks were in crisis, this Government and Fianna Fáil found the €64 billion needed to bail them out. When citizens are in crisis, the Government holds up its hands and says it can do nothing.
“It puts the demands of international bank bondholders over the needs and rights of ordinary Irish citizens. It’s inability to make banks understand their debt to the Irish people is the Government’s biggest failure to date.
“The ECB is lending at .75% and yet Bank of Ireland told customers today that the cost of lending had gone up. We need the Government to intervene with the banks on interest hikes.”