FLAC welcomes interim recommendations of Expert Group

6 July 2010

FLAC today welcomed provisions contained in the interim report of the Mortgage Arrears and Personal Debt Expert Group but noted that major issues remain to be addressed by the Group which are of utmost concern to many thousands of households around the country.

"This interim report contains many positive measures which will improve the current situation and will be of assistance to people," said Noeline Blackwell, FLAC Director General. "FLAC is hopeful that this Group is on course to deliver workable solutions for people in mortgage arrears in Ireland."

Key advances in the interim recommendations include:

  • A standardised procedure- Mortgage Arrears Resolution Process (MARP) - to be developed by all lenders to handle mortgage arrears cases, involving the establishment of Arrears Support Units in each lender to ensure uniform processes for dealing with cases.
  • Improvements to Mortgage Interest Supplement including the removal of the ban on paying MIS to a couple where one partner is in full-time employment and the suspension of the rule which excludes the payment of MIS when a house is up for sale, as well as the suggestion that the MIS scheme be more consistently applied.
  • The ban on penalty interest and arrears charges to borrowers involved in the Mortgage Arrears Resolution Process.
  • Improvements to the Code of Conduct on Mortgage Arrears, particularly that it will be admissible in legal proceedings and will apply to all lenders including credit unions and local authorities.
  • A recommendation that urgent consideration be given to reforming judicial bankruptcy proceedings and establishing an effective non-judicial debt settlement process, work currently being finalised by the Law Reform Commission.

FLAC notes that the Group will be conducting further work on advanced forbearance measures including loan modification and will be examining approaches to manage shortfalls and other options for borrowers in cases of unsustainable mortgages.

"FLAC will continue to contribute to the workings of the Group in a constructive manner through the membership of its Senior Policy Researcher Paul Joyce. Our focus in the area of debt has always been and will continue to be the protection of vulnerable consumers," concluded Ms Blackwell.



Editors' notes:

  1. 1. FLAC (Free Legal Advice Centres) is an independent human rights organisation dedicated to the realisation of equal access to justice for all. It campaigns through advocacy, strategic litigation and authoritative analysis to contribute to the eradication of social and economic exclusion.
  2. The government has released several statements on the Interim report: