Bríd Smith (Dublin South Central, People Before Profit Alliance)
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438. To ask the Minister for Finance if the code of conduct for mortgage arrears is a voluntary code; if not, if a regulatory body in the State will enforce its application; the mechanism the State has to ensure financial and corporate bodies abide by the code and engage with persons in arrears; his policy on dealing with threats to family homes as a result of such arears; and if he will make a statement on the matter. [14186/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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The Central Bank of Ireland Code of Conduct on Mortgage Arrears 2013 (CCMA) was introduced to ensure that regulated entities have fair and transparent processes in place for dealing with borrowers in or facing arrears on a mortgage which is secured on a primary residence, and it is part of the national policy framework of supports and protections available to assist borrowers in financial difficulties.

The CCMA is a statutory code issued under Section 117 of the Central Bank Act 1989.  The provisions of the CCMA are legally binding on regulated entities, and the Central Bank has the power to administer sanctions on regulated entities for a contravention of the CCMA under Part IIIC of the Central Bank Act 1942.  Also a failure to comply with a written direction from the Bank to secure the observance of the CCMA will constitute an offence.

The CCMA sets out the process that entities must follow when a borrower is in or facing 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. All cases must be handled sympathetically and positively by the regulated entity, with the objective at all times of assisting the borrower to meet his or her mortgage obligations.  Furthermore, regulated entities must explore all of the options for alternative repayment arrangements (ARAs) offered by that entity, in order to determine which ARA, if any, is appropriate and sustainable for the borrower’s individual circumstances. Under the CCMA, a regulated entity may only commence legal proceedings for repossession where it has made every reasonable effort to agree an ARA with the borrower and other clear requirements are met, or the borrower has been classified as not co-operating.  The CCMA also provides for an appeals mechanism, including where the regulated entity declines to offer an ARA, where the borrower is not willing to enter into an ARA offered, or where the entity classifies the borrower as not co-operating.

The Central Bank advises that the protection of mortgage loan borrowers, including those in arrears, is a key priority and that its engagement with regulated entities is very intrusive to ensure that they meet its expectations and regulatory requirements. It also advises that it will continue to assertively 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. 

The Deputy may also wish to know that the Central Bank has launched a public consultation on possible improvements to the Standard Financial Statement that is set out in the CCMA, and to also give people an opportunity to provide comments more generally on the CCMA and the requirements of the mortgage arrears resolution process as provided for in the CCMA (see attached:- .).  Submissions may be made to the Central Bank at consumerprotectionpolicy@centralbank.ie and the closing date is 20 April next.