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Government has responsibility to struggling homeowners after encouraging reckless lending during boom years – Ferris

7 July, 2010 - by Martin Ferris TD

Responding to the Government’s proposals to protect mortgage holders who are struggling with their repayments Sinn Féin Housing Spokesperson Martin Ferris said the Government has a responsibility to struggling homeowners as they encouraged reckless lending during the economic boom years.

He said:

“Sinn Féin has long been calling for measures to help homeowners who are in trouble. During the economic boom we called on the Government to intervene to stop banks giving out irresponsible mortgages to people who were desperate to get onto the so called property ladder.

“However, instead the Government actually encouraged such activity and this has led to the current situation where thousands are in negative equity and facing home repossession.

“Sinn Féin has put forward a number of proposals to help homeowners who are struggling to keep up with repayments.

“These include a provision for mortgage holders in arrears to pay principal only repayments as opposed to interest only payments which ultimately benefit the bank rather than the mortgage holder.

“We called for a provision to allow mortgage holders to negotiate with their banks to move from fixed mortgages to flexible mortgages without financial punishment and we said a proportion of negative equity should be written off for those struggling to keep up.

“We also supported an increase in mortgage interest supplement and a change of the means test to allow for a decent standard of living. However, we said that it is crucial that negative equity is marked down as otherwise increasing the supplement would simply bulk up the banks at the taxpayers’ expense.

“We will be examining the Government’s proposals with a critical eye. We welcome the move to help struggling homeowners however, in the past too many of the Government’s proposals have been about saving the banks with taxpayers’ money rather than helping struggling homeowners.” ENDS

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