Minister defends scheme to help worst mortgage defaulters which he calls 'game-changer'

This scheme will open to AIB, EBS and Haven mortgage defaulters in the worst state of arrears.

Its fundamental rules are the surrendering of the property, a write-off of residual debt and a long 30-year lease to stay in the home.

The applicant must qualify for social housing and the house value must comply with mortgage to rent rules, that is a ceiling value of €365,000 in Dublin or €280,000 outside.

David Hall is from iCare Housing, the not-for-profit group that has done this deal with AIB, and that will become the landlord.

Mr Hall said: "The debt is fully written off, no ifs, buts or maybes, fully written off.

"They have an opportunity to get back on track again, get their lives together, get their heads together, get their jobs together, get the family together.

"We're not-for-profit. Any profit we make goes back into funding for social housing."

There is also a buy back option for people whose circumstances change and that will be the same value the property was surrendered at.

Minister for Housing Eoghan Murphy and Social protection Minister Regina Doherty both welcomed the deal and rejected that it is designed to let reckless defaulter off.

Mr Murphy said: "I think it could be something of a game-changer. I think we have to be, as well I suppose, conservative around selling it to people it might be able to help, because it's voluntary and it will depend upon people actually wanting to come forward.

"But I think it is a positive solution for people who can avail of it."

Ms Doherty said: "Although there are some criticisms of the scheme, these people are in huge long-term debt and have no other solution.

"The thing I like about it the most is particularly the opportunity for them to buy back their own home."

€100m has been put on the value of the plan, it is unknown how many homeowners will come forward, iCare says it could be between 500 and 2000.