Monday 20 November 2017

Code helps those in mortgage arrears to stay one step ahead

Some 169,000 mortgage account holders are not making full repayments. Photo: Thinkstock
Some 169,000 mortgage account holders are not making full repayments. Photo: Thinkstock

THERE is no doubt that one of the most pressing issues for many families right now is being able to keep up their mortgage repayments. The Central Bank's most recent data shows that 77,630, or 10.2pc, of residential mortgages were in arrears of more than 90 days at the end of March. Mortgage arrears are a top priority for the Central Bank and we are working hard to ensure that they are also a top priority within banks.

If you find yourself in arrears or you anticipate having difficulties paying your mortgage, the Central Bank's message is to contact your bank as soon as possible. While you might be anxious about contacting it, tackling the problem early on and seeking to agree a new payment arrangement is the best approach and the Central Bank has put in place a strong consumer protection framework to help you through that process.

Its code of conduct on mortgage arrears means that you must be treated fairly and sympathetically and given reasonable time to deal with your arrears. It also requires lenders to have a mortgage arrears resolution process in place and they must try to reach a solution that is appropriate for you.

In order to assess your situation and decide on an appropriate solution, your lender will need to understand your circumstances and it will ask you to complete a standard financial statement (SFS).

When completing the SFS, it is important that you give full details about your circumstances. Your lender must assist you in completing the SFS and it may already have a lot of the information it needs on file. However, if you would like to complete the SFS yourself, the Central Bank has produced a guide, which you can download from its website.

If you would like to get help elsewhere, you could contact a third party such as the Money Advice and Budgeting Service.

While early engagement is important, the Central Bank recognises that unexpected or excessive contact from your lender can be stressful, so the code requires lenders to ensure that the level of contact from them is proportionate and not excessive and limits the number of times they can contact you to three in any calendar month.

It is important that you respond to communications from your lender. As long as you are co-operating with it, it cannot impose any arrears charges or surcharge interest on you. If your lender cannot contact you, it can send a representative to visit you at your home, but you are entitled to at least five working days' notice and the purpose of the visit must be explained.

The Central Bank has produced a number of guides to help you if you are in, or are facing arrears, including:

• Mortgage Arrears -- A Consumer Guide to Dealing with your Lender.

• Mortgage Arrears -- Frequently Asked Questions.

• Guide to Completing a Standard Financial Statement.

These guides include information on the protection that is available to you and are available to download from the consumer information section of the Central Bank website, www.centralbank.ie.

Bernard Sheridan is director of consumer protection at the Central Bank.

Irish Independent

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