New figures released last week showed that there are now more than 80,000 mortgages in trouble, 44,509 mortgages were in arrears at the end of 2010, €6.2 billion is owed on mortgages that are more than 180 days in arrears and losses on mortgages could reach up to €9.5 billion.
Some believe that debt forgiveness is the only solution to our ever growing mortgage arrears problem and believe that it is unfair that we are able to “pour billion into the banks” and not provide similar financial help to hard-pressed struggling homeowners.
However speaking on the issue last year, Financial regulator Matthew Elderfield expressed concern saying that any such support or alternatively payment options could carry the risk of “moral hazard”. Not only could debt forgiveness incentivise homeowners to breach their financial obligations but “In seeking to assist households in difficulty, we need to recognise that the cost of any support will be borne by those neighbours who avoided excessive borrowing themselves or are gritting their teeth and meeting their obligations” he said.
Have your say
- Should mortgage debt be written off? Should there be debt forgiveness?