Suicide warning over repossessions

HOME repossessions are leading to suicidal tendencies among struggling mortgage holders and the break-up of couples’ relationships, an Oireachtas Committee has been told.

The warning comes amid calls by a former minister for a major subprime lender operating in Ireland to be put out of business.

A group opposed to home repossessions yesterday voiced concern about recession-hit mortgage holders. Repossessions were creating “tremendous social, psychological and economic issues” for borrowers, claimed Barry O’Flynn of the Prevention of Family Home Repossession Group.

The group wants legislation to ensure that repossession orders are granted to banks only as a last resort.

Orders should not be granted until a court had checked that a loan was granted responsibly by the lender and the financial position of a borrower had been assessed thoroughly, said Mr O’Flynn.

Other solutions suggested included allowing borrowers to foot interest only payments for a time on mortgages and allowing a moratorium on payments for difficult cases.

The cost of the measures was “insignificant compared to the socio-economic catastrophe” they would help prevent, TDs were told.

Group member and social worker Ignatius Beglane told the Oireachtas Committee on Finance and Public Service that psychiatrists were reporting that borrowers faced with home repossessions were showing suicidal tendencies.

Mr Beglane also told how the stress and grief of repossessions was splitting up couples. In Britain during the 1990s, two in every three repossessions had seen couples break up, he claimed. “It’s frightening the stress that’s out there.”

Meanwhile, TD Frank Fahy, an owner himself of over 20 properties, told fellow committee members that lender Start Mortgages should be closed down.

“Banks have been quite reasonable with the exception of Start Mortgages, who should be put off the map as far as I’m concerned.”

“The company should be put out of business,” argued the TD.

Other members also voiced concern about Start Mortgages. Fianna Fáil’s Chris Andrews said in general that some lenders had been very irresponsible, adding: “They’re nothing more than loan sharks who have preyed and continue to prey on vulnerable people.”

Head of risk with Start Mortgages Paul Murphy last night defended the lender: “95% of our customers never see the inside of a courtroom.” The lender said out of 11,000 mortgages it had granted over five years, 55 properties were repossessed.