New legal aid scheme for troubled borrowers welcomed

25 January 2016

Stock Image - Legal Advice Sign


Legal rights group FLAC has welcomed the announcement by Minister for Justice & Equality Frances Fitzgerald TD of a new legal support scheme for those in mortgage debt.  The proposed scheme, to be administered through the Money Advice & Budgeting Service and with the involvement of the Legal Aid Board, is in line with recommendations made by FLAC over the last few years.

According to FLAC Director General Noeline Blackwell: “Until now, there has been a dreadful failure of access to justice for poor people at risk of losing their homes. This is one of the most significant legal events in any person’s life and they should not be left to handle this on their own against powerful, well-resourced lenders. Some people have been able to get support from advocacy groups but what is needed is a systematic, state organised system that is available to people all around the country. If the details fulfil the promise of the announcement, this scheme, administered through the state-funded MABS and using the expertise of the Legal Aid Board, may fill what has been a scandalous gap.”

 FLAC pointed out that Minister Fitzgerald had said that the scheme builds on and complements measures already in place as promised by Government in May 2015.  The organisation has previously criticised the delay in implementing the three main measures promised, and the limited way in which the provisions have been implemented to date. 

According to Ms. Blackwell, “The government promised a review of lender failure to co-operate on insolvency agreements but when the provisions began in November 2015, they only apply to those in mortgage arrears or an arrangement on 1 January 2015. They also promised an enhanced mortgage to rent scheme which has not happened at all. And until now, there has been no provision for legal advice. So everything is happening more slowly than it should – but this advance is still welcome.”


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Editors’ notes:

  • FLAC (Free Legal Advice Centres) is a human rights organisation which exists to promote equal access to justice for all. As an NGO, FLAC relies on a combination of statutory funding, contributions from the legal professions and donations from individuals and grant-making foundations to support its work.
  • FLAC offers basic legal information through its telephone information line (1890 350 250) and free legal advice through its network of 80 volunteer evening advice centres – more at  It also campaigns on a range of issues including consumer credit, personal debt, fairness in social welfare law, public interest law and civil legal aid. FLAC has issued numerous analyses and policy statements calling for a fairer mortgage arrears resolution process.

· Legal advice and assistance – home mortgage arrears

Advice and assistance from a solicitor, drawn from panels to be set up by the Legal Aid Board, who agrees to provide specified levels and amounts of services under the Scheme at fixed cost.

Assistance and representation for insolvent borrowers in repossession proceedings involving their home, via a panel of ‘duty solicitors’ at repossession hearings, operated by the Legal Aid Board.

This will be provided without cost to an insolvent borrower, under a ‘voucher’ system, and will be accessed through MABS, working in conjunction with the Legal Aid Board.

· Legal aid – new Court review of ‘bank veto’

Provision for legal aid for insolvent borrowers seeking the new Court review under s. 115A Personal Insolvency Acts, where a borrower’s proposal for a Personal Insolvency Arrangement including mortgage arrears on their home is refused by their creditors. This component will be operated by the Legal Aid Board.

 The overall objective of the Scheme is to help people who are insolvent (unable to pay their debts in full as they fall due), and are in serious mortgage arrears on their homes, to access independent expert financial and/or legal advice and assistance, which will help them to find the best possible solutions, with priority to remaining in their homes where possible.

 The Scheme will operate for a maximum period of 3 years, and will be reviewed after 6 months and yearly thereafter.