The government’s response to the ongoing mortgage crisis defies logic. That’s according to the Waterford-based advocacy group SHARE, who offer support to those in mortgage arrears.
Ulster Bank recently announced the sale of a 1.4 billion euro loan portfolio, made up of over five thousand properties to the vulture fund Cerberus. Before that, Permanent TSB, which is three quarters state owned, sold over ten thousand private and buy-to-let mortgages to Start Mortgages.
SHARE Spokesperson and Accountant Michael Power says vulture funds are looking to turn a profit as quickly as they can. “The homeowner is the last in the order of benefiting out of this. Homeowners are facing more protracted court proceedings and an uptake in the court action itself. A lot more pressure is going to be applied because you have got to remember that the ultimate objection of the vulture fund is to realise again, and realise again in the short term. Irrespective of what O’Donoghue or Varadkar is promising us or telling us is that there is protection there, the reality on the ground is that decision makers in New York or London are going back to their shareholders and saying our turnaround is two to three years.”
He says there’s no logic to government policy. “This is the biggest social problem that this country is facing, together with the health crisis. It’s very obvious that the government and the decision makers are very far removed from people on the ground. We see it day in day out, we get 70 calls every week coming into people in the SHARE group from people in distress. I don’t want to apply logic to a wholly illogical, ridiculous situation.”
Michael Power says the state should be buying distressed mortgages. “One of the big problems that we see, with the people that are coming and reaching out to us, is affordability. We do know that people can afford anywhere between 400 and 600 per month on a repayment programme over fifteen to twenty years. And that’s what could be offered to people in these units if they were acquired by the government.”