I have been advised by the Central Bank of Ireland that Provision 39 of the Code of Conduct on Mortgage Arrears (CCMA) requires that a regulated entity must explore all of the options for alternative repayment arrangements that are offered by that particular regulated entity. These options may include the types of alternative repayment arrangements outlined in Provision 39 (a) to (l). However, Provision 39 does not oblige a regulated entity to offer particular alternative repayment arrangements to borrowers.
Provision 40 of the CCMA provides that a regulated entity must document its consideration of each option examined under Provision 39 including the reasons why the option(s) offered to the borrower is/are appropriate and sustainable for his/her individual circumstance and why the option(s) considered and not offered to the borrower is/are not appropriate and not sustainable for the borrower’s individual circumstances.
In turn, Provision 42 provides that where an alternative repayment arrangement is offered by a regulated entity, the regulated entity must provide the borrower with prescribed information, including a clear explanation of how the alternative repayment arrangement works and the reasons why the alternative repayment arrangement(s) offered is considered to be appropriate and sustainable for the borrower, including demonstrating, by reference to the borrower’s individual circumstances, the advantages of the offer for the borrower and explaining any disadvantages.
Provision 45 provides that if a regulated entity does not offer a borrower an alternative repayment arrangement, for example where it is concluded that the mortgage is not sustainable and an alternative repayment arrangement is unlikely to be appropriate, the regulated entity must provide the reasons on a durable medium to the borrower and advise the borrow of the other options available to them, the borrowers right to appeal the decision to the regulated entity’s Appeals Board and that the protections of the MARP no longer apply.