More explosives are piled on debt carousel of misery

IT was more speed hating than speed dating. Furtive glances... the anticipation — a mixture of dread and diminishing hope... people wondering who they would get and what the next few minutes would lead to.

Everyone seemed aware it was a moment that could really change their lives for ever.

But this was actually the end of a deeply unhappy, and increasingly bitter, relationship, not the beginning of a bright new one.

The time when both sides were forced to admit they had made promises they could not keep in order to attract the other all those years ago and now there was no escape from the ugly, inevitable break-up.

Waiting with a friend in the bank’s “distressed” mortgages section as the minutes ticked down to their date with destiny was certainly an eye opener.

The foyer was heavy with footfall from the victims of the bubble property boom, and bank staff would swoop in and take clients off one by one.

The remaining mortgage meltdown sufferers would watch the ones being ushered into little partitioned offices like cows viewing their fellow knackered beasts being led to the slaughterhouse.

The ebb and flow was like a carousel of misery as the individuals were shepherded away, their fate about to be sealed.

The newspaper property supplement on the glass-and-steel coffee table was a grimly ironic touch, reminding all present of the mass hysteria of the mid-Noughties that had led to this point of no return, as the sheen of the sumptuous leather chairs exemplified the gloss of the misery business.

Attempting to give moral support to a friend battling with a business so lacking in morality threw up ironies of its own.

The friend freely admits they had been stupid to borrow so much in the first place — Feb 2007, the statistical peak of the madness — but the bank was also culpable for lending such an amount.

An amount it should have been obvious to the alleged financial experts of the time could well end in mutual disaster.

The bad news business was brisk, the interview rooms had been double-booked and the waiting time was extended accordingly.

Once inside the 6ft x 8ft space — roughly the size of the Dublin city centre apartments going for half a million at the height of the boom — it was reminiscent of one of those holding cells you see on airport docusoaps where illegal immigrants and suspected criminals are interrogated.

The power of the individual comes to the fore in such circumstances as the agent of the bank can either ease the intense stress of a client with a glimpse of humanity on a humiliating day, or compound it with coldness and condescension, depending on their manner and tactics.

My friend was lucky and was met with some warmth and honesty.

It was even suggested that once through this, there was hope “on the other side,” like it was a bereavement, which in a sense it was. The death of a distant dream that had become a constant nightmare.

The relationship was now not just “distressed”, but “unsustainable”, and the home would have to be sold as part of the final reckoning.

But that would not be the end, as despite the collapse in house prices, my friend would still be liable for the massive gap between what was borrowed and what the property would now sell for.

That debt will feed into the collective anchor of depression that will anchor this economy in permanent stagnation for at least another decade.

Anecdotal evidence would suggest the encounter, as fraught as it was, was not as bad as most experience, as high-pressure tactics appear to be the norm across a loan shark/debt recovery sector the Central Bank is giving a virtual free hand to.

The Central Bank has set “targets” for mortgage “resolutions”, but in practice these are meaningless as banks merely have to make “offers” to people in debt misery to win the indulgent blind eye of the supposed regulators.

In this twisted Alice-Through-The-Looking-Glass system the “offers” do not have to be viable, or even accepted, they just have to be made in order for new statistics to be produced to make it look like something is actually being done about this slow-motion crisis.

Often the “offer” is just an insistence to people struggling on interest-only arrangements that they have two months to stump up the full capital and interest payments again, or else sell the house.

Just 0.2% of people are being allowed split mortgages which park the negative equity chunk of the loan so that people can stay in the family home.

Finance Minister, Michael Noonan, the man with such an insight into the Real World he said young people were going to Australia for a suntan rather than because it was their only chance of the dignity of work, has been boasting to the troika how he is set to unleash a wave of repossessions.

To excite his overlords even more, Mr Noonan went on to state in the official memorandum offered up to the ECB-IMF-EU money masters that banks will also be allowed to ratchet-up the harassment cold calls to families already breaking under the strain of debt pressure.

Seeking a troika pat on the head, Mr Noonan gushed about how he was doing their bidding by pushing through new laws overturning an effective High Court bar on mass repossessions, in force since 2009, stating: “We recognise the need for efficient repossession procedures to promote the completion of sustainable mortgage solutions.”

Just to make it clear whose side he is on, Mr Noonan added he wants to “remove unintended constraints on repossessions for mortgages created prior to Dec 2009”.

And just to make things worse, the Central Bank’s new code of conduct slashes the time-lag between falling into arrears and being taken to court from 12 months to two months.

Just as they sowed the seeds of the financial collapse in the bubble boom by being allowed to act as they chose, banks are once again being given a whip hand to hound those they once pushed money at.

The watchdogs sleep as the misery creeps.

Some 144,000 are now in arrears, the long-threatened time bomb is about to detonate — but rather than try to defuse it, Mr Noonan and his Central Bank buddies are piling on yet more explosives.