Mortgage holders in arrears deserve ‘fresh start’

MORTGAGE holders in unsustainable arrears deserve a fresh start and this can be achieved through the reform of bankruptcy laws, according to Financial Regulator Matthew Elderfield.

The regulator warned, however, that the introduction of a debt forgiveness scheme for mortgage holders in arrears would pose “grave difficulties”.

Addressing the Association of Compliance Officers in Ireland in UCC, Mr Elderfield went on to warn any such scheme would create perverse incentives and make the arrears problem worse by encouraging some borrowers to stop making payments.