Home repossessions - Ill-timed suggestion by regulator

THE Jekyll and Hyde nature of Irish life was all too apparent yesterday as an outlandish proposal of higher salaries for top bankers was flagged by the financial regulator while at the same time 100 struggling mortgage holders saw orders for possession of their homes sought by lenders since December 2009 being struck out.

The question beleaguered homeowners will ask Central Bank regulator Matthew Elderfield is whether he is totally out of touch with reality?

His contention that fresh blood is needed in the banking market and that the only way to get it is by removing the salary cap in place will be anathema to hard-pressed taxpayers.

With people struggling to hold onto their homes and trying to put food on the table, now is not the time to remove the ceiling on bankers’ pay. To do so would be like a red rag to a bull.

Mr Elderfield made his ill-timed suggestion at the MacGill Summer School in Donegal. He would do well to reflect on the fact that it was mainly down to the reckless behaviour of bankers that Ireland is mired so deeply in debt and that it will take generations to pay off the IMF and EU bailout loans.

Meanwhile, the same bankers are mercilessly squeezing troubled homeowners and forcing companies to go out of business by refusing to lend them money.

Even as he was addressing the Donegal event, there was a glimmer of good news for homeowners following the High Court judgment on mortgages. Thanks to the tireless efforts of New Beginning, a group representing lawyers and business people in defence of mortgage holders, there could be relief for those in arrears with mortgages created before December 2009.

According to New Beginning, a question mark now hangs over the entire repossession system since 2009 as a result of the ruling by Ms Justice Elizabeth Dunne that a lending institution cannot apply for an order for possession where a mortgage was created before December 1, 2009, but where a demand for full payment was not made until after that point.

Given the jaundiced view of lawyers in the eyes of the public mind because of the actions of a handful of rogue practitioners, the Trojan efforts of this group to achieve justice for ordinary people will go some way towards restoring the tarnished reputation of the legal profession. The decision arises due to the repeal of 1964 legislation by the Land and Conveyancing Reform Act of 2009 which came into force on December 1 that year and only covers mortgages taken out since then.

Effectively, according to New Beginning, this places a significant question mark over the entire repossession system since December 2009. Both lenders and homeowners now find themselves in uncharted waters.

Ironically, as this legal minefield was unfolding at the High Court, delegates at the McGill Summer School heard the financial regulator advance the argument that recapitalisation would make it easier for the banks to help mortgage or small business customers struggling to meet debts they cannot pay.

Be that as it may, given the callous attitude of the banks in the current crisis, struggling homeowners and company managers will find it hard to swallow the line that after bringing the country to its knees top bankers should be paid even more.