Cork TD calls for targeted mortgage interest relief to support households 

A Cork TD has called for the introduction of temporary and targeted mortgage interest relief to support households struggling with the sharp and sudden spike in interest rates.

Sinn Féin TD for Cork South-Central, Donnchadh Ó Laoghaire, warned that many mortgage holders are facing interest rates as high as 10% and risk falling into arrears and financial distress.

“In the past year the ECB [European Central Bank] raised its key interest rate nine times,” Mr Ó Laoghaire said.

“As a result, hundreds of thousands of households have seen a massive increase in their mortgage interest costs."

Mr Ó Laoghaire said this represented a huge income shock for households.

“The Central Bank estimates that one in five households will see their annual mortgage costs spiral by more than €5,700 as a result of these rate hikes, with two in five seeing their annual mortgage costs rise by more than €3,000.

“For so many workers and families, the spike in interest costs is too much to bear as they deal with a wider cost-of-living crisis," he said. 

Households who had their mortgage loans sold to vulture funds, Mr Ó Laoghaire said, are now facing interest rates as high as 10%. 

The Cork South Central TD said the Minister for Finance, his constituency rival Fianna Fáil TD Michael McGrath, could not stand idly by.

“Sinn Féin have called for the introduction of temporary and targeted mortgage interest relief, providing support to households with 30% of their increased interest costs. But it is clear that wider action is required,” Mr Ó Laoghaire said.

“Banks should never have sold the mortgage loans of customers to vulture funds without their consent." 

This was something that Taoiseach Leo Varadkar and Mr McGrath’s predecessor in the Department of Finance, Paschal Donohoe had supported, Mr Ó Laoghaire said, with dire consequences for households.

“The Central Bank and retail banks must act to free households from the clutches of vulture funds," the Sinn Féin TD said.

“For borrowers who have no option to fix their rates and are paying higher mortgage repayments than they would be if their loans were held by retail banks. 

“It is time to right this wrong and for the Minister for Finance to convene a meeting with the Central Bank and retail banks and chart a way forward.”