Payment Break about to end borrowers are asked to find remedial solutions
The repayment of loans and rents is about to start in the coming weeks. Home owners and other borrowers now has to find long term remedial solutions for this.
Payment breaks were given to around 86,000 mortgage accounts since mid of March, with 43,000 still subject to relief as of August 21st. According to Banking & Payments Federation Ireland many borrowers returned to regular payments after an initial three months.
The federation is now trying all their means to encourage borrowers coming off payment breaks to discuss with their financiers and work on their available options.
They have also launched a website called paymentbreak.ie, which answer to the customers query and clarifies their doubts.
Borrowers who have not applied for payment breaks to date can ask for it until the end of September.
They can apply for up to six months of relief. This relief is being offered to households and businesses affected by the economic shock arose due to Covid-19.
The Federation said that the guide emphasizes to customers that lenders have expert staff who specialize in the area of mortgages and mortgage arrears, and they will be there to help people talk through their personal case and together consider the options that are most appropriate for them.
“While banks appreciate that many customers may be in a position where they are able to return to full repayments on their mortgage, they also say in the guide that they understand that some customers may still be financially impacted and will be fully supported through what happens next, and how to manage their mortgage repayment issues.” Said the federation.
The guides carry strict rules and guideline for the lenders to follow. These the norms set up by the Mortgage Arrears Resolution Process to help the borrowers who are planning their next steps as they exit their payment break.
The State’s five retail banks set aside a mutual €2.6 billion of supplies in the first half of this year to level the probable surge in bad loan losses as a result of the economic crisis.
Directions from the economic sector recommends that the five lenders will end up taking as much as €3.6 billion of damage charges for 2020 as a whole.
Eamonn Hughes, an analyst with Goodbody Stockbrokers said that the approach of the expiry of payment break terms was always going to generate some speculation on ‘Will they or won’t they be extended?’
“Our base case was always ‘No extension’.” He said.
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