BRIAN LENIHAN has ruled out the prospect of introducing a blanket mortgage bailout for homeowners struggling to keep up in their repayments, after a report from an expert group stopped short of recommending one.

Bloomberg quotes Lenihan as saying the government had accepted the recommendations of the Expert Group on Mortgage Arrears and Personal Debt, which instead had proposed the introduction of a deferred interest scheme which would see mortgage holders defer a third of their interest payments for up to five years.

The plan would, the group said, give struggling mortgage holders – many of whom are struggling to balance their repayments with falling incomes or unemployment – time to “get back on their feet”.

“The Government accepts the groups recommendations,” Lenihan said in a statement, “and wants to see them implemented without delay.”

The group’s recommendations also included a reform of the bankruptcy procedure, encouraging lenders to help borrowers looking to ‘trade down’ as a result of negative equity, and a new system for resolving debt disputes that bypasses the courts.

The group’s report suggested that the majority of mortgages were still being repaid as prescribed, with 90% of mortgage holders still meeting their monthly obligations, while RTÉ adds that two-thirds of rescheduled loans are paying at least full interest on their caps.

The Department of the Environment was also urged to implement new regulations allowing struggling mortgage holders to seek social housing before being foreclosed.

Mortgage advisor Karl Deeter believes the group’s findings – which show 40,472 households in arrears by over three months – mean there are over 90,000 homeowners behind on their repayments when when local authority loans, and those who are over a month behind, are included.