Debt forgiveness to become the norm for unsustainable debt, says Moody’s

International ratings agency Moody’s expects debt forgiveness to become the normal way to deal with unsustainable mortgage debt in Ireland.

In a note issued yesterday, Moody’s said that once all other avenues were exhausted lenders would be left with little choice but to offer debt forgiveness.

“Moody’s expects debt forgiveness — rather than repossession — to become the preferred option for lenders dealing with borrowers that have unsustainable mortgage debt.”