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Ó Caoláin in call for action on fixed rate mortgages

27 May, 2009 - by Caoimhghín Ó Caoláin TD

Sinn Féin Dáil leader Caoimhghín Ó Caoláin has called on the Government to act to assist people who are tied to fixed rate mortgages for their homes and who face punitive penalties if they apply to switch to a variable rate mortgage.

In the Dáil today (Wednesday) Deputy Ó Caoláin called on the Minister for Finance to bring in new legislation and/or regulation to compel the banks and building societies to address this and other crucial issues facing hard-pressed mortgage-holders. He said:

“Given that the Government is using taxpayers’ money to bail out the financial institutions it must act far more effectively to address the crisis for many house-holders who face huge difficulties meeting exorbitant mortgage repayments. In extreme cases this is leading to a growing number of repossessions but for many thousands more it is driving them into poverty, especially as the rate of unemployment grows.

“People who have fixed rate mortgages face huge penalties if they apply to switch to variable rate mortgages and this is an issue that is of increasing concern, having been raised with me as an elected representative on many occasions.

“Codes of practice for financial institutions are not enough. We need stronger legislation and regulation by the Minister for Finance, compelling the financial institutions to renegotiate mortgages and to allow people to transfer to variable rate mortgages. The institutions must be required to pass on ECB interest rate decreases.

“Sinn Féin is also calling for a legal requirement on banks to take all steps necessary to protect low income and unemployed people facing mortgage default and home repossession including rescheduling payments or allowing interest-only payments for a period of time, the establishment of a new payments scheme for newly unemployed mortgage holders in which interest payments are suspended until new employment is found, and a moratorium on principal home repossessions for low and middle income homeowners until after the recession.” ENDS

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