A mortgage-to-rent pilot scheme is expected to get underway very shortly, but anyone thinking that this might be the solution to all their home loan debt problems should probably think again. The scheme is just one of several proposals from the latest expert group on mortgage arrears and negative equity.
While the Keane Report throws out some lifelines to the nearly 100,000 people who already cannot pay their full mortgages, it is not a solution for the delivery from debt that many might have hoped it would be.
The authors clearly state that anyone who is making their repayments, no matter how difficult or how large their negative equity, is just going to have to keep doing so. The idea that somehow the government would come up with a clever scheme to allow people to pay a mortgage commensurate with today’s market price of their home, or even 110% of the market price, was never a runner. The Irish banks may be just about properly capitalised now, but there is still billions in interest repayments alone for the cost of the €60 billion plus bailout. This means that there isn’t really any spare money to give anyone debt forgiveness if they still have the capacity to make their monthly payments.