Mortgage holders in crisis

 

Sir, – While the number of pandemic assistance payments has fallen due to some people being able to return to work, the Government is ignoring an inevitable mortgage tsunami as people who had good incomes, but who work in the occupations most hit by the pandemic, face paying their mortgage out of the pandemic payment which has just been reduced to a maximum of €300 per week.

While financial institutions are offering Covid-19 payment breaks, all this means is that the customer does not receive letters complaining about non-payment or underpayment of the mortgage during the official break. In most cases, customers will end up paying more per month when the payment “break” ends.

Where the customer was already in difficulties and had arrears, such Covid-19 “breaks” are not the answer.

What is needed is the restoration of the mortgage interest supplement which helped mortgage holders in difficulties. This payment was means-tested and subject to strict conditions. However, in January 2014 the scheme was closed to new applicants and wound down for existing claimants over a four-year period. When this period ended, those who still needed the payment continued to receive it but under the Supplementary Welfare Scheme.

While rightly those people whose incomes are inadequate to meet market rents receive help through the Housing Assistance Payment scheme, or via a supplementary rent allowance for a short-term need, mortgage holders now get no help from the State, even if through no fault of their own they cannot meet mortgage repayments.

While the Money Advice and Budgeting Service can work with mortgage holders and the lending institutions to find a workable solution, the reality is that acceptable solutions may not be possible in many cases.

If mortgage holders hand the keys back to their lending institution and are no longer home “owners”, they can then join their local council housing list providing their net income does not exceed €35,000 to €42,000, depending on their personal circumstances.

Once on the housing list, an individual or family is eligible for the HAP payment, which can be substantial. Keeping the family in their home and the children in local schools through a mortgage interest supplement could be much cheaper than paying Housing Assistance Payment to private landlords, as well as being more socially appropriate.

Why should mortgage holders not receive State support when in genuine need, given that tenants get help? How is the current position equitable? – Yours, etc,

ENID O’DOWD,

Ranelagh, Dublin 6.