The Central Bank's revised Code of Conduct on Mortgage Arrears states that when arrears arise on a borrower's mortgage and remain outstanding for 31 days from the date the arrears arose, a lender must inform the borrower of the impact of missed mortgage repayments and repossession on the borrower's credit rating.
Under the Mortgage Arrears Resolution Process, a lender must explore alternative repayment arrangements including an interest-only arrangement for a specified period. Where an alternative repayment arrangement is offered by the lender, the lender must provide the borrower with a clear explanation, in writing, of the alternative repayment arrangement, including how the alternative repayment arrangement will be reported by the lender to the Irish Credit Bureau and the impact of this on the borrower's credit rating.
In the normal course of events, if a borrower enters an interest only repayment arrangement their credit rating may not be affected; however, where there are arrears outstanding on the mortgage account, the borrower's credit rating may be affected and the borrower must be advised of this.