Fine Gael Longford/Westmeath Senator Nicky McFadden has hit out at banks which are treating flood victims with callous disregard when it comes to mortgage repayment and debts.
According to Senator McFadden, there have been several instances of insensitive behaviour by banks in dealing with flood victims, and she outlined one instance where a bank told a flood victim, ‘It’s your debt, you pay,’ when he enquired about restructuring his mortgage.
“After such a disaster, some of the treatment by banks is nothing short of inhumane.
“It is at times like this that understanding and sensitivity is needed when dealing with people who have seen their lives destroyed and houses and businesses demolished. However, instead of cutting flood victims some slack when it comes to their mortgage repayments, some banks are behaving in a callous manner, demanding payment despite the fact that the property may have been destroyed.”
Senator McFadden referred to one example which she described as “particularly galling”.
“I was contacted by a homeowner who saw his house destroyed last week by the flood. The house is completely uninhabitable and will be for several months while refurbishment work goes on. During this period, the homeowner will have to rent another apartment. As a result, it will be near impossible for him to meet both a mortgage and rental repayments.
“However, when he contacted his bank to inform them of the situation and to request a stay on his mortgage or a restructuring in his payment plan, he was bluntly told ‘It’s your debt, you pay’. This callous treatment cannot be justified.”
In addition, says Senator McFadden, the compensation package on offer from the Government is already insufficient.
“Even if it is increased, it will be months before any cash is provided to flood victims. The same time delay will apply to insurance claims.
“There is obviously no way that he can sell the destroyed property, particularly since an assessor informed him that the house is now worth only €50,000, a stark reduction on the €165,000 he paid for it last year.
“It makes absolutely no sense for the bank to behave in such a way. Flood victims want to clear their debts but will have problems in the short-run. The least that banks can do is provide some ‘breathing room’. That way, banks will get the payments they need once compensation and insurance payments kick in, and homeowners will not fall further into debt.
“I will be raising this issue in the Seanad and will be echoing calls from Fine Gael’s environment spokesperson, Phil Hogan TD, for banks to provide interest-free loans as an immediate bridging mechanism. This is the least that the banks should be asked to do after being bailed out by the same taxpayers that got hammered by the flooding.”