Mortgage holders’ advocate defends funding from AIB

An advocate for distressed mortgage holders has defended his group’s decision to accept funding from AIB to act as a mediator between it and distressed borrowers.

Mortgage holders’ advocate defends funding from AIB

The Irish Mortgage Holders Organisation, which is working as a charity, will be paid by AIB to position itself as a free independent mediator for heavily distressed borrowers.

Responding to criticism of its partnership with the bank, David Hall said neither he nor the other directors would be paid for their work and it was about making sure those reluctant to deal with the banks had somebody to advocate for them.

Mr Hall said the scheme had been piloted successfully for more than a year and he denied that it would fight to keep people in their homes at all costs.

He told RTE’s Today with Sean O’Rourke that already two people have sold up and declared bankruptcy because that was the best option for them and four more are pursuing that route.

Mr Hall said in excess of 30 properties had been sold as part of a full and final settlement with the banks.

“This has been tried and tested for 12 months by AIB,” he said.

The IMHO will formally come into being on Nov 18 and will seek to provide an alternative to the more costly legal initiative, the Personal Insolvency Practitioners’ service.

The IMHO-AIB partnership will be set up on six-month trial basis and it will aim to help between 300 and 400 borrowers.

The IMHO group was criticised by finance journalist Jill Kerby who challenged Mr Hall to explain how it would stand up to the banks if it was reliant on them for funding. She said its proposal to hire five financial advisors would be too small to deal with the volume of cases on AIB’s books.

Mr Hall said it was only one approach that was on the table and his group had applied to be regulated by the Central Bank. He hoped all groups that are regulated will have their performances measured, on an anonymised breakdown of how its case load was handled.

Mr Hall dismissed any suggestion that it would be an agent for AIB and said the bank’s staff would “not set foot inside the office of the IMHO”.

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