THE FINANCIAL SERVICES Ombudsman has warned financial institutions that they need to “get up to speed” on the mortgage arrears crisis as it is currently the county’s “biggest challenge”.
“Let’s be brutally honest, this is the defining issue of our time. How are we going to deal with that? My office, we’re five years into the financial crisis and we’re just starting to see these issues, these complaints,” Bill Prasifka told Marian Finucane on RTÉ Radio One today.
The Ombudsman said his office’s ‘clear message’ to lenders has been to start dealing with the crisis immediately.
“They have to look to resolve matters,” he continued. “It is the most critical issue we are facing as a country.”
He described the number of complaints relating to mortgage arrears as a “tsunami” of correspondence, noting that banks will have to put resources behind the issue or “they’ll pay for it later”.
He also told Finucane that he does not believe most cases of mortgage arrears will be dragged through the courts.
“That would be an unmitigated disaster. The banks have to understand what their responsibilities are.”
The Financial Services Ombudsman deals with consumer complaints but cannot order the bank to create a new product – it merely ensures that the institution is engaging with the customer and following correct procedure.
Latest mortgage arrears figures revealed that one in eight accounts are behind in their payments by more than 90 days.