ECB critical of FF-sponsored mortgage arrears Bill

Draft legislation would introduce Mortgage Resolution Office with wide powers

The bill proposes a new regime covering all home mortgages in arrears before January 1st, 2017. Photograph: iStock

The bill proposes a new regime covering all home mortgages in arrears before January 1st, 2017. Photograph: iStock

A bill put forward by Fianna Fail, proposing a new organisation with wide powers to deal with mortgage arrears, has been heavily criticised by the European Central Bank, which said it may undermine legal certainty for lenders and potentially affect the supply of lending and the interest rates offered to borrowers.

The ECB, which was asked to comment on the Bill by the Oireachtas Committee of Justice and Equality, said that the regime it proposes – involving a new Mortgage Resolution Office (MRO) operating within the Insolvency Service – is being put forward “without the benefit of a thorough economic impact assessment”.

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