Tuesday, June 25, 2013

25/6/2013: IMHO Open Letter to Minister Noonan

Irish Mortgage Holders Organisation have published an open letter delivered to Minister for Finance, Michael Noonan, TD concerning the revised Code of Conduct. Here is the link to the letter:

This comes on foot of our earlier submission to the consultative process on the same, available here:

Disclosure: I am a director and one of five founders of the organisation.


Stephen said...

For the most part your articles are really balanced and well put across, but what is your solution to the mortgage problem? It is almost impossible for banks to actually repossess non-paying mortgage holders and there are a number of cases where they can't go after the won't pay crowd.

For example two days ago a repo was refused because the mortgage holder stopped paying after two months. http://www.irishtimes.com/news/crime-and-law/seven-home-repossession-cases-struck-out-at-the-high-court-1.1441269

Don't get me wrong, those who legitimately can't pay deserve help. But it should never have gotten to the point now where someone can't be removed from a "family home" when they can't afford it.

TrueEconomics said...

I agree with what you are saying. No one at IMHO argues that there should be no repossessions at all. In a very small number of cases we handled, we clearly identified people who can afford to pay and yet declined to do so. We do not represent such cases. equally, no one at IMHO has argued that there should be no bankruptcies. In many cases, bankruptcy is the only resolution tool in the case of unsustainable mortgage. The issues are: 1) how do we determine the optimal feasible solution to all parties concerned, including the society at large, 2) how do we action such a solution at a minimum cost to all concerned, and 3) how do we create a system for extreme cases resolution that does not permanently damage people's chances at financial and social recovery? We believe that this can only be achieved by giving borrowers and lenders symmetric powers in negotiating such solutions. Symmetric means symmetric or equal and parallel. It does not mean advantaging borrowers over the lenders or vice versa. We also believe that the current system is wrongly biased toward providing more power to lenders over the borrowers. This is what we argue. We do not argue that there shall be no repossessions or foreclosures or bankruptcies.