Minister for Justice Alan Shatter has said that laws allowing banks to repossess homes will not lead to a huge volume of repossessions.

Mr Shatter said the Government is working to close a legal loophole preventing banks from repossessing homes and home repossessions can still take place.

He said there are currently certain circumstances where banks cannot repossess where people are in serious default.

The minister said the Government is under an obligation to correct what appears to be an unintended consequence of the 2009 legislation (the Land and Conveyancing Law Reform Act).

However, he said that is "quite different to some of the headlines I saw in some of the papers yesterday, which suggest there was going to be, as a consequence, a huge volume of repossessions".

He said insolvency legislation will be passed soon, giving people in financial difficulties hope that instead of losing their home they can enter into arrangements with banks.

New Beginning, the advocacy group for troubled homeowners, has said in closing the legal loophole homeowners must be protected.

Co-founder of the group Vincent P Martin said: "New Beginning has a measured response to this, yes there are buy-to-lets, and we recognise that repossession should take place in a functioning economy.

"It is something that has always been there for years, if you don't pay your money and there's a security of a property on the loan which one takes out, yes the bank is entitled to repossess. But in relation to family homes we believe it's absolutely critical that they are ring fenced."

Speaking on RTÉ's Today with Pat Kenny, he said the banks have rights but the position of the family home is sacrosanct in the Constitution.

He said even in the buy-to-let sector, which makes up around €200bn of the mortgage book, a lot of those people are consumers who put their pensions into buy-to-let.