Fitzpatrick urges government to consider the mortgage interest relief scheme

INDEPENDENT TD Peter Fitzpatrick has accused the government of failing to help homeowners at a time when people are struggling to keep their houses warm and put food on the table. He cited the continuing rising interest rates and urged the government to ease mortgage pressure on homeowners by introducing a mortgage interest relief scheme.

“In November, addressing the issues of home ownership and emigration among young people, the Taoiseach, then Tánaiste, Deputy Varadkar, pledged to make home ownership affordable again, advising “what we can have is stronger Government interventions to help close the viability gap”. Last week, the European Central Bank raised its base rate of interest, taking it to a rate of 3%, and pledges to raise rates by the same magnitude in March to squash raging inflation. That would see the deposit rate going to 3% and the main borrowing rate rising to 3.5%,” explained Fitzpatrick.

“After six years of interest rates sitting at zero, the biggest immediate impact will be on the monthly payments of approximately 200,000 families with a variable rate tracker mortgage. Those with €200,000 tracker mortgages on a rate of 2.5%, which will now rise to 3%, can expect their monthly payments to increase by around €50 at a time. This is at a time when people are struggling to keep their houses warm and put food on the table. For those with existing fixed-rate mortgages that are about to end and who want to remortgage, any new fixed-rate deal will be more expensive than the one they are about to leave. On top of this, mortgage borrowers whose loans were sold to vulture funds are now facing interest rates that are significantly higher than those charged by retail banks, resulting in significant financial pressure for them.

“Economists are saying that 3% will not be the peak. It is a likely that interest rates will need to be kept higher for longer as loosening prematurely could risk a sharp resurgence in inflation once activity rebounds. However, if it raises rates too aggressively, it could tip the eurozone into recession.

“The failure of the Government to help existing homeowners at a time when they are subject to a cost-of-living crisis highlights that it is pursuing policies that are making home ownership increasingly unaffordable for families. The original purpose of the mortgage interest supplement scheme was to provide shortterm support to eligible people who, due to temporary unemployment or loss of earnings, were unable to meet their mortgage interest repayments in respect of a house that was their sole place of residence. While I accept that the mortgage interest supplement should be a short-term measure, the problem is that there is no shortterm measure in place. People need a short-term supplement to ease the mortgage pressure they are under, rather than just loading more debt on them.

“The Minister for Finance, Deputy Michael McGrath, and the Taoiseach said last week that there are no plans to introduce mortgage interest relief despite a continual rise in interest rates. In December the Taoiseach, then Tánaiste, said, “It is not something we will rule out for the future but there are no current plans to do so. It would involve reopening the budget and all the consequences that would derive from that.” As we know, thousands of people are under enormous stress with their mortgages. Why do we kick the can down the road? Why wait to act when we know this is inevitable

“People in my constituency covering Louth and east Meath are struggling. Every week in my clinic I direct families struggling to pay their mortgages to MABS. While this is a fantastic service, the primary objective of all measures across the housing sector should be to increase the supply of accommodation and keep people in their current homes, whether they are rented or owned. Are we going to close our eyes and pretend that families are not struggling? The Minister for Housing, Local Government and Heritage should engage with the Minister for Finance on the implementation of a temporary measure.

“This needs to be considered in the overall budgetary and policy context, whether it be through the Personal Insolvency Act to give some help and support to people in mortgage arrears or by making amendments to the Finance Bill to bring about some alleviation for people who are in mortgage distress through the reinstatement of the mortgage interest supplement scheme. We need to act now. We need to make home ownership affordable again through stronger Government interventions to help close the viability gap. We need to offer hard-pressed families real support.

I got married in 1983, when I was 21 and my wife was 20. We bought a house for £21,000. As we could not get a bank loan, we went to the council and got a simple £14,000 loan. We went to the credit union for the balance that we needed.

It was very simple. Why are we complicating things in this day and age? I repeat that the Taoiseach, who was the Tánaiste at the time, promised Government intervention. I keep saying it to the Minister that he is kicking the can down the road. People are very much struggling. It is now that people need help. I am pleading with the Minister to speak with the Ministers for Housing and Local Government and Heritage, and for Finance, about working together to put a temporary measure in place,” stated Fitzpatrick.

History of Aiken Barracks Lecture

Capt. padriaig agnew, Michael Gaynor, old Dundalk Society, Sergeant riccardo Lucchesi at the old Dundalk Society Lecture on the history of aiken barracks Dundalk in the County Museum. This was the latest in a series of planned lectures by the old Dundalk Society which will be continued to be delivered throughout 2023.