The latest mortgage resolution figures published by the Central Bank were low because most of the restructured offers were "either unworkable or short term or both", a charity working with people in financial difficulty has said.
Last week, the Central Bank released figures showing 18,500 mortgage holders more than 90 days in arrears with repayments had their mortgages restructured, leaving 77 per cent yet to be dealt with.
Julie Sadlier, solicitor with the Phoenix Project, an advice and support charity for distressed borrowers in Portlaoise, said the total number of restructured mortgages in the 90-day plus category had actually fallen by almost 2,000.
“The restructure offers most clients have received are either unworkable or short term or both,” she said.
"We conclude this is why the resolution figures are so low, leaving repossession as the final resolution."
No end in sight
She said the people contacting the organisation for help "are exhausted by the process" and can see no end in sight. The organisation was "particularly concerned with the emotional and psychological welfare of debtors and their families".
“They are co-operating with their lenders but even so the vast majority are not being offered a restructure arrangement,” Ms Sadlier said.
Many mortgages have been deemed unsustainable, and she said, correspondence sent to the bank is often lost and information not communicated.
“Our experience of corresponding with all lenders without exception on behalf of our clients is of a chaotic process of lost correspondence and contradictory communications from more than one department,” she said.
She also claimed there were multiple breaches of the Mortgage Arrears Resolution Process (Marp), a code from the Central Bank outlining how people in mortgage arrears should be handled by lenders.
Marp code
And while the latest Marp code was introduced in July, the Central Bank has allowed lenders to derogate from fully implementing it until the end of December.
“It means mortgage restructures potentially are being pushed through without debtors having the benefit of the important protections the code provides,” Ms Sadlier said.
She criticised the banks’ internal appeals boards, describing them as “not effective or independent” and as having a “conveyor belt mentality” with no regard for personal circumstances. And she also said Central Bank guidelines had allowed lenders “considerable freedom” to interpret “sustainability” at their discretion on a case by case basis rather than setting an objective formula.
