NEW PROPOSALS to strengthen the rights of mortgage-holders in arrears have been widely welcomed.
Legal rights organisation Flac gave the proposals from the Financial Regulator a cautious welcome, saying they would give borrowers a structured process for dealing with banks and building societies when in difficulty.
Director general Noeline Blackwell criticised the lack of independent oversight of the revised code of conduct.
"It is still very much an internal process which allows the lender to determine what is a suitable mortgage repayment package. The only external recourse will be a complaint to the Financial Services Ombudsman."
Flac also called for a wider, holistic approach to indebtedness. "Callers to our legal information line and to our network of centres are telling us that they are under pressure from many different creditors, and unable to deal with them all," Ms Blackwell said.
The Irish Banking Federation (IBF) said its members were committed to working with customers in difficulty.
It pointed to a number of initiatives already in place in addition to the existing statutory Code of Conduct on Mortgage Arrears, including the IBF pledge on home repossession and a joint protocol on debt management.
"The forbearance policies and practices adopted by mainstream institutions are helping tens of thousands of consumers to work with their lenders in managing their mortgage and other debt repayments," it said in a statement.
Insurance brokers association PIBA said there were some issues it would address, including a definition of arrears and an adjustment in what constitutes a family home
"We would like to see that arrears would begin to be counted only after the first 30 days from the missed payment has elapsed," PIBA mortgage services director Rachel Doyle.
Green Party enterprise spokesman Senator Mark Dearey said the proposals would come as a relief to struggling homeowners.
"The Irish people stood by the banks in their hour of need for the good of the wider economy. Now it's time for the banks to step up to the plate and assist those in need," he said.
Fine Gael's housing spokesman Terence Flanagan said the extension of the one-year moratorium on home repossessions was "fair" to honest homeowners who entered the mortgage arrears resolution process with their lender.
"We are facing an unprecedented repossession crisis unless action is taken by the Financial Regulator and the Government," Mr Flanagan said.
"That is why I welcome the publication of new mortgage arrears resolution proposals which will see a continuing one-year moratorium on repossessions once home-owners are meeting commitments agreed with their lender."