Joanna Tuffy (Dublin Mid West, Labour)
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Question 108: To ask the Minister for Finance the measures he will introduce to minimise the possibility of families losing their homes as a result of rising unemployment, falling house prices, more frequent incidence of negative equity, the prospect of widespread wage deflation and high levels of personal debt; and if he will make a statement on the matter. [6360/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Measures are already in place to support those who have recently become unemployed and who may experience difficulties in meeting their mortgage payments. For example FÁS has a specific policy in place to deal with redundancies and/or company closures. It offers a tailored approach as early as possible to the workers affected with a view to assisting them to access alternative employment and/or access to relevant skills training. This applies to workers in all sectors.

In terms of support for payment of mortgages, the Mortgage Interest Supplement, administered by the Community Welfare Service of the Health Service Executive on behalf of the Department of Social and Family Affairs, provides assistance where the mortgage relates to a person's sole place of residence. People in debt or in danger of getting into debt can also avail of the services of the Money Advice and Budgeting Service (MABS). This is a national, free, confidential and independent service.

It is a particular priority of the Government to ensure as much as possible that difficulties in relation to mortgage arrears do not result in legal proceedings for home repossession. Home repossession should be, and generally is, the last resort for the lender and the preferred method of dealing with arrears cases should be early intervention.

The finalised recapitalisation scheme announced on 11 February 2009 includes a new code of conduct for Mortgage Arrears, based on the Irish Banking Federation Code of Practice on Mortgage Arrears which has been issued by the Financial Regulator and will come into force on 27 February 2009. The new Code will apply to mortgage lending activities to consumers in respect of their principal private residence in the State and is mandatory for all mortgage lenders registered with the Financial Regulator. Under the mortgage arrears code where a borrower is in difficulty the lender will make every reasonable effort to agree an alternative repayment schedule and will not commence legal action for repossession until after six months from the time arrears first arise.

In addition as part of their recapitalisation scheme, the two banks concerned, A.I.B. and Bank of Ireland, will not commence court proceedings for repossession of a principal private residence until after 12 months of arrears appearing. This is subject to the customer continuing to co-operate with their bank.