# Why should the family home be given some sort of absolute protection?



## Brendan Burgess (9 Mar 2012)

This is repeated time and time again as if it's one of the Ten Commandments

The Oireachtas Justice Committee has said: 



> Families should be facilitated as far as possible to remain in the   family home in any insolvency arrangement and the Minister should   examine the possibility of including such a provision in legislation,   according to a report on hearings in relation to the Scheme of the   Personal Insolvency Bill by the Joint Committee on Justice, Defence and   Equality.


There are many other examples. 

I presented to the Oireachtas Justice Committee and Anne Ferris, the vice-Chairman of the Committee brought up the case of a constituent who had a mortgage of €600,000 who could pay only €1,200 per month, and the bank wants to repossess his home. I replied that it may be difficult for a TD to tell her constituent, but that mortgage is completely unsustainable. They need to sell the house and trade-down to a smaller rented house.

In a later private conversation, a TD referred to a constituent who traded up in the good times and who now, with salary cuts and tax increases,  could not afford the mortgage. Again, I suggested that they trade down to a rented house. 

We have an obligation as a state to provide people with housing.  But we don't have an obligation to provide them with a house of their choice in an area of their choice. 

We know that the banks were reckless in the amount which they lent. But we also know that many people misled their banks by lying about their income and their jobs. We know that many people remortgaged their home to fund extravagant lifestyles. We know that many people remortgaged to buy investment properties and holiday homes. 

*Where a person has a chance of recovering their position and paying at least the interest on their mortgage, they should be given every opportunity to do so.

But where a mortgage is unsustainable, the lender and the borrower should recognise this. The house should be sold and the shortfall dealt with under the Debt Settlement Arrangment. 

*This is often in the best interest of the borrower. There are many borrowers who want to escape their hopeless position but they are not being allowed to do so by the lender.  Here is one good example, where the borrower has to move, but the lender won't take back the house. Here is another example where a couple bought a home together and they have split up.  It would be much more helpful if legislation was introduced to help those who want to give up their home to do so. 

We don't have the same protection for the rented home. When a rental agreement is up, the renter has to move on. If a renter can't afford the rent any longer or goes into arrears on their rent,  they lose their family home. 

Why should we have this for home buyers?


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## Brendan Burgess (9 Mar 2012)

There is no such problem in most other countries. 

In the UK, if you miss a few months, the house is repossessed and sold off promptly. 

I think our own system is better than the UK, but we need to move a bit in their direction.


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## Bronte (9 Mar 2012)

The obsession with the family home in Irealnd borders on madness.  Just take the High Court case this week with the accountant.  

I was discussing this the other day with my OH, if in debt and able to sell and repay most of the debt and able to then comfortably rent and repay remaining debt you'd be mad not to.


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## Brendan Burgess (9 Mar 2012)

Bronte said:


> The obsession with the family home in Irealnd borders on madness.  Just take the High Court case this week with the accountant.



Hi Bronte

Can you provide a link to this or tell the story?


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## 44brendan (9 Mar 2012)

The MARP process is fine as a temporary measure. It is not and should not be regarded as a long term solution for those with unsustainable mortgages. Insolvency legislation must take into account the PPR. We do not have an absolute entitlement to remain living in a property, if we cannot afford to meet interest on the loan facility & ultimately commence loan repayments.
The comparision with rented properties is a valid one. If I rent a property and cannot afford to pay the rent, the landlord must have the righ to evict me. Why should should the rights of the Bank to reposess properties be taken away? As I said on a previous post, no Bank would be prepared to lend into a market where if the loan is unpaid the are restricted from access to their security. As no landlord would rent to a tenant, where if the rent is unpaid the tenant cannot be removed from the property.
Any legislation incorporating such a requirement must be resisted, as it will undermine the property market further.


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## p15574 (9 Mar 2012)

Brendan Burgess said:


> Hi Bronte
> 
> Can you provide a link to this or tell the story?





Ridiculous situation. I'd like to live in a 2M house in D6 and not pay any of my mortgage too, if no-one could do anything about it...


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## Brendan Burgess (9 Mar 2012)

> Mr Donnelly said that on December 14, 2010, the ICS building society  had obtained an order for possession from Judge Joseph Mathews, who had  granted Mr Phelan a stay of six months on the order.
> 
> 
> Mr Phelan had  returned to court in July 2011 saying he was involved in a new business  which would assist him in discharging his arrears. He had obtained a  further six-month stay from Judge Mathews.
> ...



This is really crazy stuff. 

Maybe the protection of the family home should be reduced to homes with mortgages not exceeding €400k? 

This accountant can easily afford to rent a fine house for himself and his children.  Just not a €2m house on Brighton Road.


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## Complainer (9 Mar 2012)

Brendan Burgess said:


> Maybe the protection of the family home should be reduced to homes with mortgages not exceeding €400k?


I'd imagine that this approach could be attractive politically. There is no reason why Seanie Fitz should keep the large house in Greystones, or Bernard McNamara should keep the mansion on Shrewsbury Road, just because it happes to the be the family home.


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## Bronte (19 Mar 2012)

p15574 said:


> Ridiculous situation. I'd like to live in a 2M house in D6 and not pay any of my mortgage too, if no-one could do anything about it...


 
But there is a price to pay.  At the end of the day he will have to pay it all back, particularly as he is able to earn a very large salary and thought himself able to repay 12K a month in mortgage.


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## ajapale (19 Mar 2012)

I going to read the debates surrounding the *Family Home Protection Act 1976 *to get a bit of context.

I remember prior to this piece of legislation seeing and hearing harrowing situations of women and children being evicted or threatened with eviction after the husband abandoned his family.


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## Purple (19 Mar 2012)

p15574 said:


> Ridiculous situation. I'd like to live in a 2M house in D6 and not pay any of my mortgage too, if no-one could do anything about it...



Yes, and when rich people lose their home it's because they deserve it because they were greedy. Those on moderate incomes should get help and support because, well because they aren't rich.


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## Bronte (19 Mar 2012)

ajapale said:


> I going to read the debates surrounding the *Family Home Protection Act 1976 *to get a bit of context.
> 
> I remember prior to this piece of legislation seeing and hearing harrowing situations of women and children being evicted or threatened with eviction after the husband abandoned his family.


 
The reason for the legislation was because men were able to borrow without a wife's consent on the family home.  After this all property transactions had to have a document signed stating basically that all parties were in agreement to the loan, or that it was not the family home or whatever.  It was just to stop the scenario you outlined happening.  And it worked.


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