Banks refuse to sign up to protection code for buy-to-let tenants

Minister Alan Kelly wants banks to have ‘duty of care’ to people in distressed buy-to-lets

The group representing banks and lenders has refused to sign up to a code of conduct that would protect tenants in buy-to-lets which are subject to repossession proceedings or which have been taken over by vulture funds.

The Banking and Payments Federation of Ireland (BPFI) said last night it could not sign up to the code, proposed by the Residential Tenancies Board (RTB) for “legal” and “operational” reasons.

The code would ensure that tenants in buy-to-let homes taken over by a bank, receiver or vulture fund would have the same legal rights as tenants renting from a landlord.

It would have compelled financial institutions taking control of a rented property to take on all the responsibilities of a landlord: to do repairs and to return a tenant’s deposit when they leave.


It would also have enabled tenants in such homes to refer disputes to the RTB – a right they lose when a receiver or vulture fund takes over a property.

A BPFI spokesman said last night: “Lenders determined, after careful consideration, that it was not possible, for legal and operational reasons, to agree to the guidelines proposed” by the board. “The RTB has been advised of this position.”


The RTB, which maintains a national register of private private residential tenancies, confirmed that its proposals had been rejected and that the BPFI had cited legal and operational reasons.

Although the RTB remains open to exploring whether a code can be drawn up, it is understood legislation may now be necessary to give effect to calls made by Minister for the Environment Alan Kelly last year that banks and receivers moving to repossess or sell buy-to-lets, take on a "duty-of-care" to tenants.

A senior source in the department said: “We now need to consider how to achieve the intent of the code in terms of protections for tenants in distressed buy-to-lets by way of legislative amendments to the Residential Tenancies Act and other legislative codes applying to receivers.”


A guide, published by the BPFI, sets out the rights of tenants’ in homes which have been taken over by a financial institution.

Titled A Residential Tenant's Guide to Receivership, it says: "All of your landlord's obligation to you under your lease and under law remain the responsibility of the landlord and are not affected by the receivership.

“In general neither the bank nor the receiver take over the landlord’s obligations to you.”

However, it goes on to say:“Generally the appointment of the receiver does not change your obligations under your lease.”

The rent must still be paid, but to the receiver and not the original landlord.

Tenants' advocacy groups such as Threshold say it is questionable whether a landlord who is no longer receiving rent will feel obliged to continue with their obligations, for example to maintain the property or return a deposit.

Threshold chief executive, Bob Jordan, has said tenants often only become aware that their homes had changed hands "very late in the day and usually after there has already been a court hearing".

Kitty Holland

Kitty Holland

Kitty Holland is Social Affairs Correspondent of The Irish Times