Dáil Éireann Debate, Tuesday - 16 November 2021
392. Deputy Paul Murphy asked the Minister for Social Protection if supports are available to persons who are in receipt of disability allowance who are trying to pay off a mortgage in view of the fact that a person in receipt of social welfare payments can avail of rent assistance. [55863/21]
View answerThe original purpose of the mortgage interest supplement scheme (MIS) was to provide short-term support to eligible people who were unable to meet their mortgage interest repayments in respect of a house which was their sole place of residence, due to temporary unemployment or loss of earnings.
The 2011 Inter-Departmental Mortgage Arrears Working Group Report, known as the Keane Report, identified mortgage interest supplement as an inappropriate long-term support. The central tenet of the report’s findings was that mortgage interest supplement did little to assist families in improving the long-term difficulty in addressing their mortgage difficulties The scheme only covered the interest payments on the mortgage; it did not reduce the value of the outstanding mortgage and, in effect, acted as a subsidy to the lending institution while creating a potential welfare trap for the customer, with customers accumulating arrears whilst receiving support.
The mortgage interest supplement scheme was discontinued for new entrants from 1 January 2014. The most appropriate way in which customers experiencing mortgage difficulties is through on-going engagement with their lender to explore a sustainable and appropriate repayment structures with their lending institution.
Under the Central Bank's Code of Conduct for Mortgage Arrears (CCMA), measures and policies are in place to support customers in financial difficulty with their mortgage commitments. The CCMA is issued by the Central Bank under Section 117 of the Central Bank Act 1989. providing an appropriate framework for customers, with the responsibility of forbearance for a customer’s mortgage difficulties resting with the mortgage service provider. Under the CCMA, lending institutions encourage customers to contact them at the earliest opportunity regarding their concerns and any particular circumstances which may impact on the customer’s financial well-being. The CCMA provides support for those that are in: arrears, pre-arrears or those who fall under scope of the Mortgage Arrears Resolution Process (MARP).
There are services provided by the State which can assist and advise those in financial difficulty:
- ABHAILE is the national mortgage arrears resolution service. It is provided free of charge to insolvent borrowers who are at risk of losing their home due to mortgage arrears. ABHAILE is focused on providing expert financial and legal advice and assistance to borrowers to identify and put in place solutions to their arrears, and wherever possible, enable the borrowers to remain in their home.
- The Money Advice and Budgeting Service or MABS, under the aegis of the Citizens Information Board, also continues to provide assistance to people, in particular those on low incomes or living on social welfare payments, who are over-indebted and need help and advice with debt problems. As part of its free services, MABS also provides help and advice to those in mortgage arrears.
I trust this clarifies the matter for the Deputy.
