Dáil Éireann Debate, Wednesday - 31 March 2021
126. Deputy Thomas Gould asked the Minister for Finance the credit implications of missed mortgage payments due to the economic impact of the Covid-19 pandemic; and the actions he has taken to mitigate same. [17159/21]
View answerA key focus of the Government and the Central Bank is to ensure lenders are acting in a way that protects the best interests of borrowers, and in line with relevant codes and regulations. In particular, in respect of mortgages which are secured on a primary residence, regulated entities are required to comply with the Code of Conduct on Mortgage Arrears and deal with all arrears (and pre-arrears) cases in a sympathetic and positive manner with the objective at all times of assisting the borrower and to deliver appropriate and sustainable solutions and facilitate as many borrowers as possible to return to making loan repayments.
Borrowers who are experiencing financial difficulty should engage early with their lenders, and lenders have specific obligations to support borrowers. Borrowers should consider what they can pay and should be cautious about accruing significant amounts of arrears where it is not necessary. Lenders must engage with borrowers to identify appropriate and sustainable solutions to a mortgage or other loan difficulty. Lenders should use the full suite of restructuring solutions available to them, including short-term forbearance (and which can include further short-term payment breaks). Borrower circumstances differ, so the right solution for each borrower differs too and borrowers will need to be assessed on a case-by-case basis.
Where reporting to the Central Credit Register (CCR) is concerned, lenders are obliged under the Credit Reporting Act 2013, to submit information to the CCR. Submission of information to the CCR must be consistent with the arrangements agreed and in accordance with lenders obligations under the Credit Reporting Act 2013. This may include details in respect of restructures if agreed by the parties. The CCR produces credit reports, based on factual information submitted by lenders. However, it does not produce credit scores or ratings, or provide guidance or instructions to lenders on the approach they should take to future applications for credit. Subject to compliance with all relevant financial services legal and consumer protection requirements, the decision on applications for credit is a commercial matter for the individual lender.
Borrowers can get their credit report, free of charge, at www.centralcreditregister.ie and they can also amend information on the CCR if it is inaccurate or not up to-date. More generally, if a mortgage or other loan applicant is not satisfied with how a regulated firm is dealing with them in relation to an application for credit, or they believe that the regulated firm is not following the requirements of the Central Bank’s codes and regulations or other financial services law, they should make a complaint directly to the regulated firm. If the mortgage applicant is still not satisfied with the response from the regulated firm, he or she can refer the complaint to the statutory Financial Services and Pensions Ombudsman.
In terms of the impact of COVID-19 on mortgages, the Deputy may wish to note that BPFI data indicated that, at the end of 2020, almost 74,000 primary dwelling mortgage payment breaks were provided. Of these almost 72,000 had expired and almost 89 per of these expired payment breaks had returned to full repayments. However, I will continue to work with the Central Bank, as regulator, to ensure that the Central Bank consumer protection and other applicable frameworks will be fully available to all borrowers that still need support at this time.
