Neale Richmond (Dublin Rathdown, Fine Gael) | Oireachtas source

I am very grateful to Deputy Durkan for raising this matter and bringing it to my attention and the attention of the line Ministers responsible. As the Deputy will know, the Government is acutely aware of the pressure that the rising interest rate environment may have on borrowers. In light of this, the Minister for Finance, Deputy Michael McGrath, convened a meeting with lenders that are active in the mortgage market on 31 August last. Representatives of the Central Bank of Ireland, the Insolvency Service of Ireland, the Citizens Information Board and the Money Advice & Budgeting Service, MABS, were in attendance. Following this meeting, on 6 September Banking and Payments Federation Ireland launched the second phase of its dealing with debt campaign to highlight new and existing supports available for mortgage customers.

One of the new initiatives to which the Minister and I would draw the Deputy's attention is the work between credit servicing firms and MABS on a streamlined customer engagement framework to accelerate the agreement of sustainable repayment plans for customers in financial difficulty. The consumer protection framework provides the same protections for borrowers regardless of the regulated entity with which they are dealing, be that a bank, retail credit firm or credit servicing firm. All of these regulated entities must be authorised and supervised by the Central Bank and are subject to the full suite of relevant regulatory requirements and financial services legislation, including the code of conduct on mortgage arrears, CCMA. A broad range of measures are in place to protect mortgage holders as part of this code of conduct, especially those who are experiencing difficulty with their repayments. The CCMA outlines how a lender must act if a borrower is in or is facing mortgage arrears. The CCMA sets out the process that entities must follow when a borrower is experiencing difficulties with their mortgage payments. Due regard must be given to the fact that each case is unique and needs to be considered on its own merits. Regulated entities must explore all of the options for alternative repayment arrangements, ARAs, in order to determine which arrangement, if any, is appropriate and sustainable for a distressed borrower’s individual circumstances.

The range of sustainable solutions being offered to consumers has expanded significantly, including the use of new ARAs, mortgage-to-rent arrangements and personal insolvency arrangements. The CCMA provides for an appeals mechanism, including where the entity declines to offer an ARA, where the borrower is not willing to enter into the ARA offered, or where the entity classifies the borrower as non-co-operating. Appeals can ultimately be referred to the Financial Services and Pensions Ombudsman. The CCMA must be complied with under the law. The Central Bank has the power to take enforcement action against any regulated entity that does not act in compliance with the CCMA. The Central Bank continues to supervise compliance with the CCMA and will investigate any issues that arise, including patterns of behaviour which suggest that the CCMA process is not being followed. Under the CCMA, the lender must contact the consumer about their mortgage arrears in a timely, clear, and consumer-friendly manner; get information from the consumer about their financial situation; assess whether a suitable ARA can be made; and resolve the case by offering an ARA or not doing so. The CCMA has been designed to protect consumers. Regulated lenders are legally obliged to comply with it. The CCMA requires lenders to provide dedicated and specially trained staff in their arrears support unit to manage cases. This includes having any meetings with consumers in private and referring them to their online or hard-copy information. Lenders must also follow the mortgage arrears resolution process, which sets out how lenders must communicate with consumers and assess their situation with the aim of coming to a resolution. It includes having an appeals process in place so consumers can appeal certain decisions of their lender. This is a robust framework that binds all regulated lenders. If the Deputy has evidence that firms are pursuing borrowers contrary to the provisions of the CCMA, the Central Bank of Ireland will consider any such information as part of its supervisory duties.

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