Legislation passed through the Dáil only weeks ago designed to strengthen the rights of mortgage and debt holders in dealing with banks, still gives lenders the power of veto over distressed borrowers, the country’s largest brokers’ group has claimed.
The Personal Insolvency Amendment Bill 2014 was recently passed by the Dáil and is due to be soon written into the statute books. It was meant to strengthen protections for consumers when striking deals with lenders over debt they cannot repay.
However, according to PIBA, which represents 890 financial brokers, including mortgage brokers, the law has been hollowed out that banks have retained a veto when voting for deals on debt deals with borrowers.
PIBA says its member brokers see on a day-by-day basis the huge financial hardship ordinary people are facing. It says statistics showing the number in mortgage arrears is falling masking the long-term financial hurt facing many people.
Rachel Doyle, PIBA chief operations officer, said that consumers have been left exposed. “The amendments in the latest legislation still leave many with no right to challenge a creditor’s entitlement to a veto on a proposed solution. That maintains a power imbalance in favour of lending institutions.
“And it would appear to be a fudge, kicking the can down the road, treating all debtors in the same fashion and failing in any effort to distinguish between those who have an ability to repay and those who don’t.
“What we’re seeing is that genuine defaulters can now be classed as strategic defaulters,” Ms Doyle said.
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