A report by an expert group on mortgage arrears has recommended the introduction of a new Mortgage Arrears Resolution Process (MARP) across the financial industry to help home-owners struggling to pay mortgages.
Read the report here
Finance Minister Brian Lenihan said the Government had accepted all of the recommendations of an interim report by the Mortgage Arrears and Personal Debt Expert Group. The Financial Regulator also committed itself to acting quickly to implement the most important recommendations.
The report recommends that lenders can not apply penalties to borrowers who are taking part in MARP, which is a framework to be developed by all lenders to handle cases where home-owners are struggling iwth repayments.
It also says the current Code of Conduct on Mortgage Arrears should be amended to enable the MARP to be implemented. It also says lenders should not be allowed to encourage home-owners to switch from mortgage products such as trackers, if it would put them at a financial disadvantage.
Lenders are also not allowed to use forbearance measures, or MARP, to move borrowers to less favourable terms.
The Cabinet has approved significant changes in the Mortgage Interest Supplement (MIS) Scheme, which were recommended in the report.
These changes will allow an eligible couple where one person is in full-time employment to qualify for the MIS.
The original ban on ban on paying MIS to such a couple has been removed and a revised means test is to be developed.
The new proposals will also allow the payment of the supplement while a house is up for sale.
Lenders are also required to engage in increased and improved communications with borrowers. All lenders must have a dedicated section on their website for those who get into financial difficulties.
Information about State supports must also be provided to borrowers in distress, and assistance must be given if applying for supports through the MARP process.
Keepingyourhome.ie, a joint Citizen’s Information Board/MABS website, is to be the main information portal for all communications with borrowers.
