The luck of the Irish: banks to pay off mortgages

by Caroline Dann12 Oct 2012

In an unprecedented move, the Irish government will pass laws encouraging banks to substantially cut homeowners' debts.

 
The move, aimed to reduce foreclosures and help thousands who are struggling, is being closely watched by the US to see if it is a viable preventative to a housing crash.
 
Critics argue unscrupulous borrowers will simply take advantage of the bailout and stop making payments altogether.
 
Before we get too excited, the government is merely making a suggestion: paying off or substantially reducing the debt will not be 'enforced' according to Ireland's justice minister Alan Shatter.
 
Too bad.
 

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