FLAC thoughts on new CCMA, are they well thought out?

I can’t help but feel disappointment when I hear that FLAC are calling for banks to be highly limited in their ability to make unsolicited contact to resolve issues with debtors. This was widely reported (audio clip here), but doesn’t go on to state why it’s good, bad, or why it may need to be changed, the suggesting isn’t coming out of thin air.

Our thoughts are that pragmatism must win out, a level of limiting power along with a corresponding engagement and non- harassment policy is possible. Our submission to the Central Bank (below) attempts crudely to consider this.

The TD Stephen Donnelly reported in the Sunday Independent that he had constituents who were being harassed by the banks and that the use of auto-diallers was a part of that. This didn’t count as unsolicited contact because under the precise rules of the Code of Conduct on Mortgage Arrears calling a person then not leaving a message doesn’t count as ‘contact’.

At the same time it …

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Mortgage Arrears for the first half of 2010

We expected a 10% increase in mortgage arrears for the first half of this year, moving the total from 32,321 households to 35,531, however it increased 10.73% and the final figure was  36,438 [statistics for the last four quarters are below].

There is an ongoing inability for banks to deal effectively with people in arrears, both in terms of having the operational capacity or liquidity to offer debt relief in some form, and on the other side we have the Financial Regulator who is incrementally stripping away their power to enforce the mortgage via repossessions.

The arrears of the second half 2010 will go up again, there is no sign of either a slowing growth in arrears, or of a slow down in the rate of growth.

The only growth area in our economy at present seems to be in the deterioration of debt quality . . . but for the second half of the year it will not only be an ‘unemployment’ lead increase, rather it will be with the additional impact of lenders creating the problem via mortgage …

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Primetime 2nd February 2010: Mortgage Market Focus

Primetime took a look at the mortgage market situation in Ireland on the 2nd of February, they spoke to various industry experts as well as people on the street about their feelings on the situation. The clips below are well worth watching.

In this clip Primetime spoke to people on the street, and the general opinion was one of empathy for borrowers in trouble but the overall tone was that people didn’t necessarily want to step in and have their tax money going to bail them out. Then David Murphy interviews an anonymous borrower who is in debt trouble, as well as getting the opinion of Irish Mortgage Brokers Operations Manager Karl Deeter and Paul Joyce of the Free Legal Aid Centre (FLAC).

In the second video Pat Farrell of the IBF (Irish Bankers Federation), Stephen Kinsella (Lecturer of economics at University Limerick, and author of ‘Ireland in 2050), Pauline Blackwell of FLAC (free legal advice centre) and Ciaran Cuffe of the Green Party talk to Miriam O’Callaghan about the issues of debt and the solutions for solving …

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