Anger as families at the mercy of lenders

GOVERNMENT and bank pledges to protect mortgage holders have been rubbished after a couple with a special needs son had their home repossessed despite offering to repay €800 a month.

The mother of the 17-year-old special needs boy told the High Court yesterday that the family had been to “hell and back” with lender Stepstone Mortgage Funding.

The couple were both let go at Waterford Crystal last year but were left facing mortgage repayments of €1,900 a month.

They had taken out a €277,000 mortgage with an interest rate of nearly 11% with the lender for their Waterford home in early 2008. The couple put an additional €70,000 in savings towards the purchase and later adapted the house for their special needs son.

Both were now unemployed, the mother said, and the home was worth less than €240,000, €100,000 less than what they had paid.

The mother said efforts were made to contact the lender about their financial difficulties and to offer alternative payments.

She was getting €220 a week as a full-time carer while the husband was receiving €204 on the dole.

But mortgage arrears had now mounted to nearly €40,000, the court heard.

Stepstone Mortgage Funding had refused to consolidate the arrears and mortgage payments into one debt so the family would be accepted for HSE mortgage interest relief payments, the mother said.

The couple offered to pay €800 a month, including all the carer’s allowance, but the lender refused in court to accept the offer.

Judge Brian McGovern told the mother: “I wouldn’t hold out much hope. Your situation is becoming more common now.”

The mother told the court: “I’m sorry I ever went to them [the lender]... they brought me to hell and back and they can have the house.”

She later conceded to the possession order: “I think I’m only putting off the inevitable. I have to think of my child... he’s my main priority.”

Judge McGovern granted a six-month stay on the possession order, saying: “I have to say I think you’re doing the right thing because the figures don’t stock up for you even if you were paying €800 a month, things would only get worse.”

Counsel for the lender was also granted legal costs from the defendant despite the judge suggesting he hoped this wouldn’t be requested because of the woman’s predicament.

Eight repossession orders were granted in court.

The opposition reacted furiously to the Waterford case calling for robust support for troubled mortgage holders.

Fine Gael environment spokesman Phil Hogan said: “There has been no bailout in the NAMA legislation for the hard-pressed mortgage holder.”

Labour’s Ciarán Lynch called for a home mortgage agency with statutory powers which would attend court cases and assess mortgage holders.

A spokesperson for the charity Barnardos said: “We wouldn’t wish this to happen to anyone at any time of year. There should be support measures in place.”

Focus Ireland advocacy director Mike Allen said: “This just shouldn’t happen. The Government needs to put through legal protection for those in arrears.”