ICare set to buy 23 homes to avoid families being evicted

APPROVED housing body iCare has negotiated a multi-million euro loan facility from AIB to allow it to buy more homes from distressed mortgage holders.

Some of the €30m loan from AIB will be used to purchase another 23 homes and rent them back to the families that live in them, under the State’s mortgage-to-rent scheme.

This will avoid them being evicted.

Last year iCare, which is headed up by David Hall, bought 130 homes.

Mr Hall said: “This is a significant development with such a low rate. This will be the first purchase of social housing since Covid-19.”

The 23 homes are being bought off banks and vulture funds. mong the banks selling to iCare are AIB, Bank of Ireland and Permanent TSB. And credit servicers for vulture funds Lapithus, Mars, Pepper and Start Mortgages.

Mr Hall said iCare now has 589 houses approved for purchase through nearly all lenders and funds.

The average discount negotiated throughout this batch 40pc of open market value, he said.

Under mortgage to rent, an approved housing body buys the home. A long-term social housing style lease is set up with a local authority.

The family’s debt is cleared, allowing families to remain in their property.

The scheme has helped banks remove long-standing non-performing loans from their books. There are income limits and property value limits to qualify for the scheme.

Mr Hall said: “We are preparing for the aftermath of Covid-19 and will be prepared to help as many households as possible stay in the home.”

The mortgage debt campaigner said he was lobbying to have the mortgage-to-rent scheme central to the incoming government’s programme for government.

He said much has been learned since the last recession.

The mortgage-to-rent scheme has been altered a number of times because of poor take-up initially.

“Had the scheme been fit for purpose many more families could have been helped,” Mr Hall said.

Central Bank figures show just short of 28,000 mortgage holders are in serious arrears and unable to make any payments for at least two years.

Up to half of those will be unable to restructure this debt, but may qualify for the mortgage-to-rent scheme, experts maintain.

The pandemic has resulted in more than 65,000 mortgage payment breaks being granted over the past few weeks.

This has prompted a leading academic to warn that a fresh mortgage arrears crisis is “inevitable” due to the impact of the virus.

Dr Padraic Kenna, director of the Centre for Housing Law, Rights and Policy at NUI Galway, said given the economic impact of the coronavirus, it was important that mistakes of the past were not repeated.

“Covid-19 will inevitably result in a new round of mortgage arrears, and many of the challenges of the last decade will re-emerge,” he warned.