When billionaire investor George Soros set up his Open Society Foundations it was launched as a way in which to attack the establishment. Subjects such as war crimes, media freedom and prejudice around the world have been taken on by the Open Society Foundations in recent times. However, the George Soros funded organisation is now taking to the courts to help suffering homeowners in the Irish property market.
Evictions in Ireland
Official statistics show that one in 10 Irish mortgages is now in arrears totalling in excess of €4.5 billion. The number of foreclosures has tripled over the last five years and the situation is expected to get worse before it gets better. Those who follow the Irish property market will be well aware of the implosion in light of the US mortgage crisis back in 2008. While headlines would suggest some areas of the Irish property market are making a recovery, the number of foreclosures is increasing.
Historically, the Irish courts have never looked favourably on eviction notices due to mortgage arrears. This goes back to a number of cultural issues such as British control although the situation has changed over the last few years. The Open Society Foundations has been working on a case suggesting that European Union law has not been used in these instances and the human rights of those with mortgage arrears have not been honoured.
Working with Irish lawyers
Open Society Foundations has been extremely active in Ireland over the last few months spending in excess of €100,000 working with Irish lawyers. There have also been a number of seminars up and down the country highlighting the plight of those threatened with repossession of their homes. At this moment in time it is unclear how Irish lenders might be able to recoup some of their losses if they are not able to foreclose on these properties and liquidate assets on their books. Are the lender supposed to finance those in arrears for ever and a day? Should the Irish government step forward with yet another compensation plan?
It will be interesting to see how this particular issue pans out because recently one repossession case was halted for a judicial review. The case in question revolved around a loan of €130,000 taken out to finance a family’s debt. This forced the family to default on their mortgage payments back in 2009 and five years later they were served with a repossession notice. While we await the actual judicial review of this case, and the way in which similar cases have been handled, a number of courts up and down Ireland are postponing repossession cases ahead of the result.
Is this fair?
This is a very difficult situation because it is likely to get worse before it gets better. The number of foreclosures in Ireland has increased dramatically, more households are facing mortgage arrears and the banking sector is being placed under more pressure. As far as Irish lenders are concerned, the involvement of Open Society Foundations will at best delay repossession cases and at worst could prevent future foreclosures.
Quite how this will impact the banking community in the medium term remains to be seen but this continued uncertainty helps nobody. Could this tip Ireland back into a deep recession?