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AN Offaly pensioner has told of his relief that the mortgage-to-rent scheme has cleared his debt and allowed him to stay in the house he loves for the rest of his life.
Tullamore native Tom Roche has urged anyone who is in mortgage distress to get help from the Money Advice and Budgeting Service (MABS) first because he found them “fantastic”.
The 73-year-old Rhode resident confessed he considered harming himself and going back on the drink after being off it for 26 years when he fell behind on his TSB loan.
Mr Roche bought a half-acre site near Rhode with over €70,000 in savings in 2001 and then received loan approval from the bank (now called Permanent TSB) for a €150,000 15-year mortgage to build his house.
At the time, he was on a “very good” salary with the non-governmental organisation (NGO) he founded, Just Forests.
An education and lobbying group for environmental causes, with a focus on sustainable forestry, Just Forests was receiving funding from the Department of the Environment, Concern and Trocaire.
“I got mortgage approval straight away,” said Mr Roche. He went ahead and built a 1,200 square feet two-bedroom bungalow (see picture below), plus a detached workshop for his carpentry and furniture restoration business.
“Everything was good for a while, I paid [the bank] back €72,000 over the next eight or nine years. Never once did they have to pick up the phone looking for the mortgage, it was there every month on the day.”
The recession of the late 2000s spelled the end of the Government grant for Just Forests. “When the crisis came NGOs like Just Forests were the first ones cut, the first to be wiped off the payroll,” said Mr Roche.
“I knew what was happening and I was straight into TSB in Tullamore. I didn’t delay one minute and I said I have lost my job, I have no livelihood coming in and I’m going in to sign on social welfare.”
He made an effort to keep up some repayments but soon found it almost impossible. Meanwhile, the bank began to contact him constantly.
He succeeded in getting other work but the arrears on his home had gone “sky high” so that even after paying back €72,000 the bank were “looking for €165,000” from him – €15,000 more than the original loan.
Mr Roche said he reached the point where he would stand at a bridge and “wondered would I… I was in an awful state. Thanks be to God I never went back to the drink. It would have softened the pain but it would only create more pain in the long run.”
After an unsuccessful attempt to agree a personal insolvency arrangement with the bank, he decided to try the mortgage-to-rent option and got assistance from the MABS office in Mullingar.
His mortgage has been bought by iCare Housing and through the mortgage-to-rent scheme he is treated as a social housing tenant in his own home once he surrenders the property.
As of May 10 last, Permanent TSB said the total owed by Mr Roche was €199,741, including arrears of €155,769.
His house has been valued at €205,000 and following what the lender says are “deductions to cater for repairs to the property”, a sale price of €129,807 was agreed between Permanent TSB and iCare, resulting in €69,934 being written off.
Mr Roche said another advantage of the scheme is that because he is becoming a social housing tenant he does not have to pay for ongoing maintenance in his home.
“I have signed the voluntary surrender and it goes back to iCare and when it’s finalised I get to stay here for the rest of my life. I’ll have to pay a nominal rent of about €40 a week,” said Mr Roche.
He said the mortgage-to-rent solution, which was negotiated through MABS, iCare and Offaly County Council, was the ideal one for him.
“It was my only option, it was either that or get out because I didn’t have the money to pay [the debt]. I see this as wonderful, this relieves an awful lot of stress and strain. I’m in the house I love to be in and I get to stay here for the rest of my life and my debt is cleared. If I do get a few bob it’ll go into my back pocket.”
He advises people in debt to seek help as he did: “Don’t ignore it, deal with it, get help from MABS or a PIP [personal insolvency practitioner]. MABS are so professional. They know how to deal with the banks.
“Life doesn’t stop just because you’re in mortgage distress. It’s very stressful but there are mechanisms and ways of means of helping people to deal with it nowadays.
“Thousands of others lost their salaries too. And today you have professional people who are both working and their combined salaries aren’t even able to pay a mortgage. That’s crazy and that’s why I say I’m so lucky.
“I’m not ashamed of what happened because it was not my fault. I didn’t do anything wrong. When I had my funding coming in the mortgage was paid every month on the day.”
Mr Roche said he had offers from family to move. A sister in Canada offered him a room and a cousin in Co Westmeath offered to let him live at his house but would modify it so that the Offaly man could have his “own front door”.
“I said no, it’s my house and I’m going to stay here and I’m going to fight this because what they’re doing is unjust. I didn’t do anything wrong, it was the banks that created the financial crash, not me,” he said.
A divorced man who remains busy with furniture restoration, commissioned work and environmental campaigning, he has recently trained as a welder to expand his skillset.
He concluded: “I can live here for the rest of my life. I could have moved but I’d never have a workshop like [I have] and I’d never be able to do what I can do at the moment.”
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