Burton’s plan falls well short of promised independent mortgage advice function – McGrath
Published on: 06 September 2012
The announcement by Minister Joan Burton this morning of €250 worth of advice from an accountant for a limited number of persons in mortgage distress falls way short of the independent mortgage advice function recommended by the Keane report and promised by government, according to Fianna Fáil Finance Spokesperson Michael McGrath.
Deputy McGrath stated, “The scheme of independent financial advice announced by Minister Burton is a major disappointment and will only be available to a fraction of those in mortgage distress. Critically, the scheme is only open to those who have been offered long term resolution proposals by their lenders, leaving the vast majority of those in mortgage distress without any professional advice whatsoever.
“The banks have been extremely slow to come forward with such long-term forbearance solutions and I cannot understand why the Minister has narrowed the scope of this advisory service so much. The government still doesn’t seem to recognise the scale and complexity of the mortgage arrears problem.
“In contrast to what the government has announced today, the Keane report, which was submitted to government one year ago, recommended the establishment of an independent mortgage advice function whose aims would include ‘to advise customers (in arrears or pre-arrears) in their dealings with mortgage lenders’ and to ‘advise customers who have entered or been through the MARP’. Minister Burton’s proposals are far more limited in scope than the type of service envisaged in the Keane report which could potentially have been benefitted every family in mortgage distress.
“Independent mortgage advice should be available to people currently in mortgage arrears and those who believe that they will fall behind in their repayments in the near future. Minister Burton’s scheme is too limited and will deny professional advice to thousands of families in mortgage distress when they most need it. Advice is most valuable when it is given at the earliest possible point but that will not happen under this scheme.
“In addition, by limiting the provision of advice to qualified accountants, the Minister is denying other persons with relevant experience and qualifications, such as Qualified Financial Advisors, from participating in the scheme. Overall, today’s plan by the government is another missed opportunity to tackle the mortgage arrears crisis in a meaningful way.”