Fine Gael Enterprise Spokesman Leo Varadkar TD has called on the Government to include a new law in the forthcoming NAMA Bill to help homeowners to escape from high fixed-rate mortgages.
“Young homeowners and young families have been hit hard by the recession. They have seen their income eroded by pay cuts, levies and new taxes. The average young family with two young children has lost over €4,000 in take-home pay since this time last year.
“The only relief has come from the European Central Bank in the form of interest rate reductions which have saved thousands of hard-pressed homeowners. However, these reductions have not been passed on to people with fixed-rate mortgages. They are trapped in their mortgage and have to pay a very large fee to be released from it.
“The Government must cap the fee that mortgage holders are required to pay to escape from their fixed rate mortgage. It should be capped at the cost of one month’s mortgage payment. The banks are making a substantial profit on all mortgage customers who are still making repayments, while making bumper profits from those trapped in fixed-rate mortgages. Nobody, neither homeowners nor bankers, anticipated that interest rates would fall this low. We are in exceptional times and that requires exceptional measures.
“The Government rescued the banks from collapse through the Government guarantee, then nationalised Anglo Irish and recapitalised AIB and Bank of Ireland with billions of tax euros paid by young homeowners, who in return are expected to take on €90 billion worth of toxic debt. There must be some return for taxpayers. That should start now by rescuing mortgage holders from the fixed-rate trap.”