Mortgage row ‘hype’ criticised
Noonan says best to get buyers to comply with protections after sale to avoid litigation
Minister for Finance Michael Noonan said mortgage- holders were “being wound up by a number of Deputies in this House who are stating very exaggerated positions” and deliberately trying to frighten people
Minister for Finance Michael Noonan has called on the Opposition not to be “trying to frighten” the 13,000 mortgage-holders with the former Irish Nationwide Building Society whose loans are for sale by liquidator KPMG.
Mr Noonan said it was “very unfair to be hyping this”, in a row over whether mortgage- holders would retain protections they currently held, if a foreign financial entity bought the loans. The sale takes place next month.
The Minister said mortgage- holders were “being wound up by a number of Deputies in this House who are stating very exaggerated positions” and deliberately trying to frighten people.
Socialist Party TD Joe Higgins said “what is frightening people most is that the Minister is proposing a process that will put 13,000 mortgage-holders into the hands of vulture capitalists”.
The row developed during finance questions in the Dáil. Fianna Fáil finance spokesman Michael McGrath said he doubted Mr Noonan would allow AIB, Bank of Ireland, Permanent TSB or Ulster Bank to sell their mortgage portfolios in the way the sale of the former Irish Nationwide, now IBRC, loans was currently proceeding.
The Minister told him the “continued applicability of the various protections afforded to mortgage customers is legally very complex and requires careful consideration”.
“People are afraid of being exposed, vulnerable and isolated in the face of an unsympathetic fund that is out for a quick buck. That is a genuine fear. Perhaps some people have stoked up that fear but it is a very real fear that people have,” he said.
Mr Noonan said whoever bought the loans, whether Nama or an unregulated entity, “will be required to honour in full the legal terms” of the contract mortgage holders agreed with the financial institution.
“The taxpayer comes into this as well. The job of the liquidator is to get as much value for the taxpayer as he can,” he said.
He said the Opposition might rightly stress the interests of the mortgage holder “they forget about the interests of the taxpayer, because these are two sides of the same coin”.
The Minister said if he attached additional conditions to the mortgage book or portfolio at the point of sale “there is a possibility I would be legally challenged on the argument that that might reduce the value of the book”.
Mr Noonan added that it would be better not to interfere with the sales process and they could then deal with procedural protocols afterwards “and get them to comply after the sales. There is then no exposure to a legal challenge and everyone is protected.”