Fianna Fáil wants to give the Central Bank new powers to force lenders to cut their variable mortgage interest rates.
If passed, the new bill, which has been reintroduced after it was voted down last summer, would equate to serious savings for homeowners. In fact, more than 300,000 householders across the country would benefit.
At present, Ireland's variable mortgage interest rates are over double the EU average.
While Finance Minister Michael Noonan described the proposed law as “seriously flawed” and potentially unconstitutional, Fianna Fáil’s finance spokesman Michael McGrath said it's time homeowners in Ireland were given a break.
Speaking to RTE’s
Morning Ireland Deputy McGrath said: “What our legislation proposes is that the Central Bank would carry out an assessment of the mortgage market, in particular the standard variable rates being charged by the banks on principle private dwellings.
“They would assess and reach a conclusion as to whether or not the rates being charged can be considered to be reasonably and objectively justified by a whole range of factors, which we define in the legislation.
“And if they can’t then the Central Bank would be given the power to put a cap on interest rates.”
The Government is now expected to attempt a “reasoned amendment” to the bill, delaying it for up to six months.
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