Unreported Voluntary Surrenders a Cause for Concern

Ireland’s leading housing charity welcomes the two-year moratorium proposed in the Oireachtas this week but has expressed concern at the unknown number of “voluntary surrenders” of family homes taking place. Respond! Housing Association is alarmed at the increase in repossession cases coming before the courts but feels this does not reflect the full picture. The housing charity wants more to be done to protect homeowners in difficulty.
According to Respond! spokesperson Aoife Walsh, the two year moratorium is only one of a number of measures that needs to be introduced to help families who risk losing their home.

“We welcome the call to introduce a two-year moratorium for families, as well as other proposals. Many families are living in homes they can no longer afford and simply do not have the option of selling due to negative equity. It is alarming to think that by the end of 2010, 350,000 families could be trapped in negative equity. As a result, the ESRI estimates that 35,000 families could fall into mortgage arrears with the possibility of losing their home.”

Respond! also supports the call to establish a National Home Mortgage Service (NHMS) that would work along the lines of the Monetary Advice and Budgetary Service (MABS). The housing charity has in the past called for the setting up of an Independent Arbitration Committee that would provide guidance and assistance to those in mortgage arrears.

“While we are all shocked at the increase in repossession cases coming before the High Court on a weekly basis, Respond! knows that this does not accurately reflect the true extent of the crisis” added Walsh. “Many people are feeling hopeless because of the collapse of the housing market. They are simply handing back the keys of their home to their lender as there is no prospect of selling the home to repay the debt. These cases are rarely reported and Respond! suspects there may be far more ‘voluntary surrenders’ taking place than anyone is aware of. We welcome any proposals that would provide these people with a lifeline to stay in their own home” claimed Walsh.

Respond! is also challenging claims that the level of repossessions in Ireland is actually quite low and not a cause for concern. The housing charity expects that once the repossession moratorium agreed as part of the Bank Guarantee Scheme expires in February, and once NAMA is in place, the level of repossessions will increase dramatically.

“It is simply a ticking time-tomb and Government needs to act now.” concluded Walsh.