KILKENNY COUNTY COUNCIL are bracing themselves for a raft of families who look set to join the housing waiting list once the banks move to repossess homes in arrears with mortgage repayments.
Director of Services, John McCormack told councillors at the housing special policy committee meeting that in excess of forty families in Kilkenny were facing repossession of their homes.
Mr McCormack said Kilkenny County Council had been the lender of last resort for many tenants who had bought their local authoirity homes during the boom years. A number of these tenants had bought their homes with finance from the council at a discounted prices. They then remortgaged the houses with other financial institutions. Mr McCormack said that he was aware of more than 40 former council tenants who are no longer in a position to meet their repayments to financial institutions.
“We have situations at them moment where we have loans with people who used to be tenants and maybe they will loose their house. Maybe they could have remortgaged their houses at different times. Maybe they got the house off the council at a reduced price and they remortgaged and now they are potentially going to loose their houses,” he said.
Mr McCormac added that all of the talk of debt forgiveness in the media has focused in on the banks and the large money that they lent in the now famous ‘subprime mortgages’. Mr McCormac said “the local authorities were just as bad. The local authorities were the lenders of last resort during the boom years. We would have approved and given loans to people who were on the margins.”
Cllr McGuinness (Fianna Fail) proposed that the repayment limits on these mortgages be extended. “When we are talking about mortgages here we are talking about mortgages of €20,00 in some cases €40,000 so they could be very small repayments spread over a certain number of years,” he said.