You can contact our Mortgage Arrears Information Helpline on 0761 07 4050
The mortgage on your house, flat or apartment is probably the biggest and most important financial commitment that you have. When you get a mortgage, your lender (bank, building society or local authority) gets a claim on your property. If you fall into mortgage arrears, the lender may eventually seek to repossess your home.
Dealing with mortgage arrears
If you are having difficulties paying your mortgage, even if you are not actually in arrears, you should contact your lender’s Arrears Support Unit immediately. Delaying and allowing mortgage arrears to build up will make the problems worse. Your lender does not want to repossess your home. They want you to continue your payments – repossession is the last resort.
Lenders such as banks and building societies are bound by codes of conduct in relation to people who are in mortgage arrears or 'pre-arrears'. Local authorities operate under similar guidelines (pdf), which are currently being revised in the light of changes to the Central Bank’s Code of Conduct on Mortgage Arrears – see below.
In line with these codes, your lender must take certain steps to deal with any problems you have in paying your mortgage. Under the Central Bank’s Code of Conduct on Mortgage Arrears (CCMA) (pdf), lenders must operate a Mortgage Arrears Resolution Process (MARP) when dealing with customers in mortgage arrears and pre-arrears.
Several organisations provide information and advice to people facing mortgage arrears and other problem debt – see ‘Sources of information and advice’ below.
Other loans and debts
Even if you are not in mortgage arrears, or have no mortgage at all, your home could be in danger of repossession if you have other debts. If you build up other debts and are unable to repay them, then the people to whom you owe money may register such debt as a 'judgment mortgage' against your home and seek to recover their money in that way (see our document on repossession).
As part of the Mortgage Arrears Resolution Process, your mortgage lender will ask you to list your other debts when documenting your financial situation on a Standard Financial Statement (pdf).
Four important steps
As soon as you realise that you have a problem with debt, you can start taking action to deal with it. The Money Advice and Budgeting Service (MABS) can help you to do this, either face-to-face or via the MABS helpline. You can also follow the self-help guide on the MABS website or download the MABS Money Management Guide (pdf). The National Consumer Agency’s debt action plan provides useful tips – see 'Sources of information and advice' below.
The main steps to take can be summarised as follows:
1. Assess your situation. Make a list of all your debts. Check that each debt is in your name. Identify the debts needing immediate attention (for example, your mortgage arrears). Get in touch with the lenders immediately - preferably in writing. There is a sample letter (doc) on the MABS website.
2. Make out a budget. List how much money is coming into your household each week (or month) and how much is going out. You can get a blank budget sheet and spending diary (pdf) from the MABS website or through the helpline.
3. Deal with the debt. Write to the lender, making an offer of the amount you can afford to pay and explaining your financial situation. The MABS website has a sample letter of offer (doc) and blank financial statements.
4. Organise a method of paying the agreed amount. You can do this in various ways, such as direct debit, internet banking or a MABS Budget Account.
Sources of information and advice
If you have problems with mortgage arrears or other debts you can get help from the Money Advice and Budgeting Service (MABS). MABS provides a free service to help you deal with your debt and make a budget based on your income. It has also published guidance on the Central Bank’s Code of Conduct on Mortgage Arrears – this guidance is currently being revised.
MABS and the Irish Banking Federation (IBF) have developed a joint protocol (pdf) setting out how MABS money advisers can work together with creditors to help people to address and manage debt problems, including problems with mortgage arrears. There is also a consumer guide to how the protocol works.
You can also follow the self-help guide on the MABS website.
The Free Legal Advice Centres (FLAC) have published a guide to the Code of Conduct on Mortgage Arrears 2013 (pdf).
You may wish to get legal advice on your options and on what happens if the mortgage lender takes steps to repossess your home.
The Legal Aid Board also provides legal advice, but there is a means test for this. Waiting times may vary from one Law Centre to another.
New Beginning is a not-for-profit organisation which aims to represent people in this situation.
Other organisations that provide advice and assistance include the Irish Mortgage Holders Organisation (IMHO) and Phoenix Project Ireland. IMHO has arrangements with 2 banking organisations – AIB Group and KBC Bank, whereby customers can contact IMHO for direct assistance (free of charge) in dealing with these banks about their mortgage arrears.