There are a number of codes of conduct and guidlines which have been put in place to outline how lenders must treat borrowers who are either in arrears or facing the prospect of arrears.
Mortgage Arrears Resolution Process (MARP)
The Mortgage Arrears Resolution Process sets how how all banks, lenders and funds deal with borrowers in mortgage arrears or pre-arrears. It’s objective is to ensure that such cases are treated fairly with the aim of helping borrowers to meet their mortgage obligations. The Code of Conduct on Mortgage Arrears (CCMA) requires lenders to operate a Mortgage Arrears Resolution Process (MARP).
There are 4 steps to a Mortgage Arrears Resolution Process.
Communication. The borrower must be classified as ‘Co-operating’. The borrower must supply a lender with a Standard Financial Statement (SFS) and supporting documentation. A SFS details the borrowers income/expenditure and assets/liabilities.
Assessment. The lender will review the information provided and propose a solution they feel is appropriate. Typically a resolution is initially proposed for a short term period of 3-6 months.
Offer of Resolution. The proposed resolution will be offered to the borrower.
Appeal. The borrower has the right to appeal a decision by the lender. An appeal is initially directed to the lender. Following this the borrower can appeal the lenders decision to the Financial Ombudsman.
Code of Condut on Mortgage Arrears (CCMA)
The Central Bank’s Code of Conduct on Mortgage Arrears (CCMA) sets out the approach Banks must take when dealing with borrowers either in arrears or facing the prospect of being in arrears with regard to the family home.
The current version of the code came into effect on 01/07/2013.
Please find a link to the Code of Conduct on Mortgage Arrears (CCMA) below.
The Consumer Protection Code is a set of rules and priciples that apply to the regulated activities of regulated entities in the State. The code sets out how lenders must treat borrowers in arrears. The Consumer Protection Code 2012 does not apply to mortgages on a borrowers principle residence. Mortages on a principle residence are covered by the Code of Conduct on Mortgage Arrears (CCMA) as detailed above.
Please find a link to the Consumer Protection Code 2012 below.
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