AIB in deal with David Hall's Irish Mortgage Holders Organisation

Brendan Burgess

Founder
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David Hall has been tweeting about some big deal he is announcing tomorrow

David Hall ‏@davidhall75 working on a new initiative to help distressed mortgage holders with @GTCost & @arthurmullan which has been finalised.Details on Monday
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He is having a big media event tomorrow:

Niall Brady reports in today's Sunday Times that it is with AIB.

 
Fair play to David Hall for pulling this off.

I have tried to engage with the lenders and the IBF on issues such as producing a protocol for unsustainable mortgages and I have got absolutely nowhere. I wasn't even looking for payment! I must revisit my strategy - it may be more effective to rant and rave rather than to be reasonable and rational.

It seems that David Hall is now going to get paid for representing AIB borrowers in arrears. This is a very welcome development assuming he retains his independence. They will have to publish their Memorandum of Understanding with AIB, so that borrowers using their service know what the ground rules are.

It probably makes sense for AIB as well. It's much better to pay David Hall to do this than to pay a Personal Insolvency Practitioner.

It will be interesting to see how they deal with strategic defaulters. As the Sunday Times reports:

Hall clashed with AIB's Chief Executive in August after Duffy claimed that 20% of customers in arrears were strategic defaulters.

"If 20% are allegedly strategic defaulters, why has AIB not sorted out the other 80%" Hall said at the time?
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"Clashed with AIB" is a bit of an understatement. He accused the AIB Chief Executive of lying




David Hall ‏@davidhall75

Mr. Duffy while you were cleverly lying about strategic default numbers your own 90+ arrears figures went up by 2%! Nat avg 2 qrt .4%!!!!
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I was at the press conference this morning, and here are the highlights.

AIB will be giving the IMHO €150,000 to run a pilot project for 6 months.

Borrowers who wish to get advice and representation can go to the IMHO.

The IMHO will not be changing their procedures or policies or attitudes in any way.

But the IMHO will be able to employ 5 new people to provide advice over the phone and in person.

They expect to do around 300 - 400 deals a month through this service.

If demand is higher than expected, AIB will allocate more money to it.

None of the directors of IMHO will be receiving any fees, salaries or expenses.

AIB won't have any influence at all on the way IMHO sets up this service.

The work of IMHO in relation to customers of other banks won't be affected in any way.

AIB will be announcing details of a new split mortgage product in about two weeks' time.
 
NEW INITIATIVE TO ASSIST HOMEOWNERS IN DIFFICULTY​
​
The Irish Mortgage Holders Organisation (IMHO) in conjunction with AIB Group (which includes EBS and Haven) today announces an upcoming initiative offering homeowners in difficulty with their mortgage repayments the option to avail of an independent third party facilitator to advise and engage with AIB Group on their behalf. The initiative will be available free of charge to all AIB Group residential mortgage customers who wish to avail of the service.

Mortgage holders in difficulty will be provided by the IMHO with a designated point of contact where they will be assisted with and advised on the completion of a Standard Financial Statement (SFS) which is a key component for determining the most suitable solution for the resolution of the arrears. This assistance will be provided over the phone, online or in person. All advice will be supplied on a fully independent basis by the IMHO and a dedicated group of advisers from the IMHO will operate the initiative for AIB Group customers. The IMHO will then submit the relevant information to a designated team in the AIB Group arrears support unit for consideration and agreement of next steps

This service is being offered as an alternative way for AIB Group homeowners in difficulty to engage with the bank and will operate alongside AIB’s existing mortgage arrears solutions channels. The IMHO’s ongoing advice and services to customers of other institutions will remain unchanged.

Director of the IMHO, David Hall said: “This is a ground breaking initiative to ensure customers are given access to independent advice and representation in dealing with AIB, EBS and Haven. The cost of this service is grant aided by AIB Group but independently provided, staffed and managed by IMHO. Customers of AIB Group who are experiencing difficulty paying their mortgage will have the benefit of free and independent professional advice to help them engage with AIB Group and reach a sustainable solution.

“The IMHO has successfully concluded many agreements with AIB Group in the past year and this joint initiative is a recognition of the success that can be achieved. The IMHO believes that this initiativerepresents a wonderful opportunity to help a larger number of borrowers who are in arrears.

“It is important that borrowers are aware that the new code of conduct in mortgage arrears, which was launched in July 2013, compels banks to take action against borrowers who have not engaged. This initiative aims to help those who are reluctant to engage with the banks. The enormous pressure on borrowers who are in trouble frequently leads to a fear of dealing with financial institutions. We anticipate that this unique arrangement will help to drastically reduce that pressure and that fear.”
Head of the Financial Solutions Group at AIB, Brendan O’Connor said: “We strongly welcome this joint initiative with the IMHO that opens an important additional engagement and resolution channel for our mortgage customers in difficulty. Engagement is a crucial part of the arrears resolution process and we view this initiative as an important additional avenue available to customers in difficulty. We recognise that some of our customers are reluctant to deal with the bank directly and view thisinitiative as a means for people to seek free help and advice from an independent party as part of the resolution process.”

This free of charge initiative will be operational from with further information available on the IMHO website atwww.mortgageholders.ie
 
As a result of questions I asked, we got the following information

AIB will not be changing its practices or policies in any way.

Borrowers who use the IMHO service won't be getting any better deals than they would get by going directly. (But they would be better informed and empowered)

AIB said it was targeted at the 8,000 to 10,000 borrowers in arrears who have not submitted Standard Financial Statements. But anyone can go to IMHO for advice.

IMHO has been getting deals for people over the past 12 months including debt write down and debt write off where the home is voluntarily surrendered.

I asked about people who had been through MARP and the MARP appeal who had been told to surrender their home. They can go to the IMHO but AIB won't be changing their decision unless there is some significant new information disclosed. It's not a second bite at the cherry.

I asked AIB if they would fund MABS to do such work and Brendan O'Connor from AIB said that they are open to working with anyone who can help them get in Standard Financial Statements.

Where homes are voluntarily surrendered, the IMHO will not be featuring them on their register of repossessed properties. Where AIB repossesses a property against the borrower's wishes, the property will be featured. The IMHO is sorting out a few Data Protection issues and will then go live with the register.
 
So what are the implications for AIB borrowers?

You should use the IMHO for advice and to represent your interests.

They will presumably give you good advice and they will help you complete the SFS.

AS IMHO will have a dedicated division with the AIB arrears unit, they will presumably be able to get decisions quicker.

It's probably a bit like a mortgage broker, I suspect that IMRO will get you a better deal that you would get by going directly.

It depends on how busy IMRO gets. It's hard to see 5 advisors putting through 400 deals a month.
 
Brendan Burgess said:
I asked AIB if they would fund MABS to do such work and Brendan O'Connor from AIB said that they are open to working with anyone who can help them get in Standard Financial Statements.
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This is an interesting point. Do AIB have to tender all contracts? I recall that Anglo/IBRC used to publish some tenders on etenders.gov.ie;

https://irl.eu-supply.com/app/rfq/p...D=61758&B=&PS=1&PP=ctm/Supplier/PublicTenders

https://irl.eu-supply.com/app/rfq/p...ID=9595&B=&PS=1&PP=ctm/Supplier/PublicTenders

How did AIB come to pick IMHO as their preferred partner for this? Should they not have tendered and come up with the best value provider - perhaps somebody who has experienced staff already in place?
 
Hi Rainyday

I suggested to AIB that MABS would have been a much better partner with 60 offices around the country and they replied that they had been approached by IMHO and so dealt with them. But they are open to doing similar deals with other groups, including MABS.

I don't think that AIB has to put stuff out to tender.
 
Dealing with mortgage arrears on behalf of a number of people, the common issue is huge distress even where I can see fairly straight forward solutions.

What it has told me is that many people cannot deal with this themselves and need assistance.

A third party is able to strip away the emotion and the baggage and get the deal done.

I am of the view that the ISI is not a workable situation for many. And many postings here confirm that.
 
Brendan Burgess said:
AIB said it was targeted at the 8,000 to 10,000 borrowers in arrears who have not submitted Standard Financial Statements. But anyone can go to IMHO for advice.

.
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A fee if 150K works out at 15 Euro per borrower who has not completed the SFS.

They are hiring 5 people to do the actual talking to borrowers, who by the fact they have not managed to fill out a SFS will be very tricky people to deal with, no way does it make sense at 15 Euro per person.

Even if you take the figure of 400 people a month, for 6 months, that's 2400 people, the fee works out at 62 Euro per person. It could work out very cheap for AIB if it gets the borrowers to engage.

It's about 92 people to process a week, divided by 5 people, makes 18 cases per worker a week

The costs for AIB trying to tackle any one of the non engaging borrowers in a legal way is obviously not working. Why is that, wasn't the new insolvency service meant to sort all this out. Another white elephant it seems to be. I pity the poor PIP's who have paid for insurance and training in the hope of getting a lot of business.

How do the directors of IMHO get paid?

It is a great idea though for stressed borrowers to have somebody independant to help them. And fair play to David Hall on this. It's amazing that Mabs is not involved, when this area is precisely their area of expertise.
 

Good points - will five people (yet to be recruited, willing to take on a 6-month contract with no ongoing commitment, currently with no office or phone or laptop or email or website or safety statement or ....) in a startup environment be able to do meaningful work to close deals?
 
Bronte said:
It is a great idea though for stressed borrowers to have somebody independant to help them. And fair play to David Hall on this. It's amazing that Mabs is not involved, when this area is precisely their area of expertise.
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MABS already do this for anyone with any bank. Help with an SFS, deal with the bank etc

Maybe this is just an alternative?
 
Delboy said:
I thought all State run organisations had to go the tender route!!!
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They're State owned (almost!), not State-run. They're free to do business in any way they like (probably why they got into such a mess in the first place....).
 
ClaireM said:
MABS already do this for anyone with any bank. Help with an SFS, deal with the bank etc

Maybe this is just an alternative?
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But why would you need an altrernative if Mabs will do it for free? Unless Mabs is not working, or the banks will not do deals with Mabs?
 
Bronte said:
But why would you need an altrernative if Mabs will do it for free? Unless Mabs is not working, or the banks will not do deals with Mabs?
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I think people have different perceptions of different organisations. People who are not willing to go to MABS might be willing to go to David Hall.

I think AIB just want people in the process regardless of who facilitates.
 
MABS won't really try and do a 'deal' as most people see it for you. They will help you fill the SFS (maybe, some offices refer you back to your own bank who should have staff to help you deal with it) and they will write to all your creditors and probably get agreement from all them to apportion any excess income but that is about as far as they will go. Actually negotiating what David Hall would call a deal is not really what they would do to best of my knowledge.

Now I do think they actually should have been given this role but for whatever reason they were not.
 
Having someone to negotiate a deal on your behald still doesn't mean the banks are willing to do them!
 
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