The Mica Action Group says it’s vital that an agreement is reached with lenders and financial institutions who hold mortgages on mica properties.
The committee wants them to support families affected by the defective blocks issue, particularly in terms of the 10% contribution clause in the redress scheme.
The group is stressing that financial institutions are also stakeholders in this crisis, and they potentially have thousands of homes on their books which are currently valued way in excess of the real market value due to the defective blocks issue.
With this in mind, the group wants a direct contribution from lenders towards the 10% contribution.
Committee Member Joe Morgan is heading up the discussions with the lenders.
He says there has been significant engagement already, and they are now asking the government to help in that process………
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MAG statement in full –
MAG INCREASE PRESSURE ON MORTGAGE LENDERS TO SUPPORT MICA FAMILIES
The Mica Action Group have actively been engaging with banks and financial institutions who hold mortgages on mica properties in an effort to gain their backing to support families across the county affected by the defective blocks issue.
Joe Morgan, new MAG committee member, who spearheads the engagement between MAG and the financial institutions said:
“With the announcement in May of this year that there is a requirement for homeowners to contribute 10% towards the cost of the remedial scheme for the repair of their homes, MAG are bringing to the attention of the banks the absolute necessity for them to step up to the plate and support homeowners across the county.
“We are reiterating that financial institutions are also stakeholders in this crisis; they potentially have thousands of homes on their books which are currently valued way in excess of the real market value due to the defective blocks issue. It is only following the repair of these homes (through accessing the redress scheme), that this higher valuation can be reinstated.
“Without the scheme, many of these homes will never return to their former market value and due to the requirement on homeowners to make a 10% contribution, MAG feel that this scheme will be out of reach for many families without a direct contribution from the lenders, in circumstances where the families cannot make up the 10% private contribution.
“It is clear that it is also in the lenders interest to ensure homes with financial agreements secured against them (i.e. loans or mortgages) are returned to market value. If families without the means to contribute the 10% private contribution are not supported, these homes will continue to deteriorate year on year. This will lead to those families leaving their home and moving into rental accommodation. Mortgage default and repossession proceedings will follow. This is not what the homeowners want and it is not what lenders want. It is I no-one’s interest to let this happen.
“In addition to this direct engagement with lenders, and following a meeting with Minister Joe McHugh on Oct 22nd, where a commitment was given by Minister Mc Hugh to seek a joint supporting statement from The Department of Finance & The Central Bank to ask for unique financial measures from the major lenders in Donegal, last week we again wrote to Minister Mc Hugh (Minister for Education), Minister Eoghan Murphy (Minister for Housing) and Minister Pascal O’ Donoghue (Minister for Finance) asking for their respective updates on this offer of support.
The lenders themselves have stated a common approach would be very beneficial and have welcomed a supporting position from The Central Bank and Government. MAG have led discussion and debate to date and have been successful in generating significant engagement within the major lender headquarters in Dublin. They now need help from Government to bring the full circle and to exert pressure from all sides.
“In the interim, MAG are continuing to lobby the major lenders and have requested written positions from each lender by the end of November. Lender’s positions will be made public in early December, in order for families to be aware of the support mechanisms in place for them.
“It is crucial therefore that the key lenders in the county have indications of support from Government and The Central Bank ahead of this milestone. It is our intent to follow this publication with a Financial information event in Late January 2020 in Letterkenny to support active engagement between the lenders/banks and their customers impacted by the Mica crisis.
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