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David Hall is the Current CEO of the Irish Mortgage Holders’ Organisation. David, with four others, established the IMHO in 2012 to advocate on behalf of, and to provide services to assist, those in debt. He owns and runs Lifeline Ambulance Service and is also a director of Beaumont Hospital Foundation.

Repossession: What’s happening, and how to deal with it

Since September 2012, there has been a 75% increase in those in mortgage arrears greater than two years; it is now at an embarrassing level of 37,778. In addition, there are nearly 20,000 others in arrears of longer than one year. The Banks have told the Central Bank that they estimate 31,000 people face losing their home.

How it stands

Since the crisis, the last and current Government have chosen to protect banks and abandon those in arrears. There have been a number of tools introduced to try and sort mortgage arrears and personal debt. These were:

Mortgage-to-Rent, a system which would see the family home sold to a voluntary housing agency where the family become a tenant, this has had only eighty-eight cases conclude. This is because the process is too complicated and not attractive for the bank. This is currently being reviewed by the Government, due to its spectacular failure.

Next up was the reduction of the bankruptcy term from twelve years to three years; this has not helped to the level expected.

Then the Government, to great fanfare, introduced what most civilised, functioning societies have, which was an insolvency act. The numbers utilising the insolvency legislation has been embarrassingly low. The legislation is too complicated and accesses too difficult. This is also being reviewed by the Government. In total, 1000 went through the insolvency system last year, of which 448 were bankruptcies and only 199 involved property, the majority being investment properties. This has had no effect on the family home mortgage crisis.

Lastly the Government, along with The Central Bank, introduced mortgage arrears resolution targets. These were to try and force banks to resolve mortgage arrears and have, again, not been successful as the long term arrears figures above prove.

Where the power lies

A common issue is the misrepresentation that there is a suite of solutions offered by banks to deal with mortgage arrears. The reality is each lender alone controls what solutions they offer. The choice is theirs, and only theirs. In a recent case the IMHO defended (Stepstone v Clarke), Justice White ruled that despite the family being eligible for Mortgage-to-Rent, and despite the state promoting Mortgage-to-Rent, the court has no power to compel any bank to provide any solution to those in mortgage arrears.

The Government is now faced with a political storm that may be very difficult to navigate. Tens of thousands are crippled with debt, 25,000 possibly face repossession and loss of their family home.

Often forgotten with those affected by debt is the immense physical and mental pressures in trying to deal with their situation. Most are victims of a crash. This has an effect on relationships, families and friendships. Beyond the debt, this will have a profound effect on many citizens in the country.

Advice for those in arrears

The state, in its obsession to protect banks over the past six years, has failed to establish meaningful channels for debtors to access help. MABS has been abandoned, and politicians have failed to invest in developing its services to move the challenges for debtors.

It is essential that those struggling with mortgage arrears engage with their lender directly or through a trusted third party. Last year we negotiated 2556 long-term deals with lenders on behalf of mortgage-holders in arrears.

Ignoring letters from the bank will not make the issue go away.

Banks have power, real power and they use it. Meet an independent professional and have your own circumstances assessed, and see what options you might have. It’s better to know what your options are than keeping your head in the sand. There are solutions, formal and informal. Bankruptcy is an option for some, and the IMHO provides a free bankruptcy service.

When dealing with your bank read the Code of Conduct in Mortgage arears. Also here is an interesting document which banks received from the Central bank around how they expect banks to handle those in arrears.

Another useful web site is the Insolvency Service of Ireland (www.isi.gov.ie ). This details what insolvency options exist, and also, they detail the reasonable living expenses. The reasonable living expenses are used by banks as a benchmark to determining what they allow for expenditure. Many, but not all, banks add a percentage on top of the Insolvency service expenditures guideline. Also, on this site are detailed documents about bankruptcy.

You owe it to yourself, your mental health, and the welfare of your family, friends, and country to seek help and try and resolve your debt. It’s a far-from-perfect landscape, but there are solutions and we can help.