The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

A Cabinet Minister yesterday said just six borrowers out of 147 deemed “potentially eligible” had qualified for help from the Government’s Mortgage Relief Plan.

Michael Halkitis, minister of state for finance, said the Mortgage Relief Plan had exposed a high level of ‘hidden’ consumer debt which, when combined with mortgage obligations, created a burden that eliminated many struggling borrowers from the programme.

Mr Halkitis told Parliament yesterday: “We were provided with statistics, which we accepted, that showed there were approximately 4,000 loans in default.

“Of this number there were a potential 1,000 that represented owner occupied residences, including duplexes, that could possibly qualify for the programme.”

He added: “So there were not 4,000 home loans in default. Of those 4,000 in arrears, some 3,000 were a mix of vacant lots, commercial property other commercial loans and rental property.

“Out of the potential 1,000 eligible loans, the banks entertained 422 applications. Of this number, 147 were deemed potentially eligible. Of this number, six have been approved so far, with the others either not qualifying for a variety of reasons, including difficulty in verifying income. We continue to process appeals and seek ways to help homeowners in distress, including consulting homeowners on a case by case basis.”

Mr Halkitis added: “To say that we are not satisfied with the outcome so far would be an understatement. Sadly, what this exercise has uncovered is a level of consumer debt obviously not fully appreciated by the banks themselves that, when combined with mortgage obligations, create a burden that removes any financial flexibility. People have literally become slaves to consumer debt, made easy by the salary deduction.”