Michael McGrath (Cork South Central, Fianna Fail)
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245. To ask the Minister for Finance the protections that are available to a buy-to-let mortgage holder that is seeking to hold onto a tracker rate of interest as part of a restructuring of the mortgage; and if he will make a statement on the matter. [15727/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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I have been informed by the Central Bank of Ireland that the Code of Conduct on Mortgage Arrears 2013 (‘CCMA’) contains specific protections in respect of tracker mortgages. 

However, the CCMA only applies to a mortgage loan of a borrower which is secured by his/her primary residence.  For the purposes of the CCMA, ‘primary residence’ means a property which is the residential property which the borrower occupies as his/her primary residence in the State, or a residential property which is the only residential property in the State owned by the borrower.  Therefore, the protections of the CCMA only apply to buy-to-let mortgages if the residential property is the only residential property in the State owned by the borrower.

Provision 41 of the CCMA provides that the lender must not require the borrower to change from an existing tracker mortgage to another mortgage type, as part of any alternative repayment arrangement offered to the borrower, except in the circumstances set out in Provision 46.

Provision 46 provides that, in the case of an existing tracker mortgage, if following consideration of the options in accordance with Provision 39 (which states that a lender must explore all of the options for alternative repayment arrangements offered by that lender), in conjunction with Provision 41, the lender concludes that none of the option(s) that would allow the borrower to retain his/her tracker interest rate is/are appropriate and sustainable for the borrower’s individual circumstances, the lender may offer the borrower an alternative repayment arrangement which requires the borrower to change from an existing tracker mortgage to another mortgage type, if that alternative repayment arrangement:

a) is affordable for the borrower, and

b) is a long-term sustainable solution which is consistent with Central Bank of Ireland policy on sustainability.

For mortgages in arrears that do not fall within the scope of the CCMA, (e.g. buy to let properties which are not the only residential property in the State owned by the borrower), the provisions of the Consumer Protection Code 2012 (the Code) apply.  With respect to arrears resolution, the Code requires a lender to seek to agree an approach that will assist the personal consumer in resolving the arrears. However, it does not specifically prevent a lender from removing or amending a tracker rate on a buy to let mortgage in arrears.