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Mortgage-arrears code working – Central Bank
Colm Kincaid Pic: Central Bank

24 Apr 2024 / regulation Print

Mortgage-arrears code working – Central Bank

A Central Bank review has found that engagement under a code of conduct on mortgage arrears is finding solutions for struggling borrowers.

The review also found, however, that customer service and supports for borrowers facing early arrears needed to be improved.

The Central Bank found that early engagement by borrowers dealing with financial difficulties led to solutions being found, but it also identified areas for improvement in how banks and other credit firms provided information.


Colm Kincaid (director of consumer protection) said that the review had been carried out at a time when the number of borrowers falling into early arrears was increasing, due to the increased cost of living.

The review found that where there is engagement between lender and borrower under the Code of Conduct on Mortgage Arrears, solutions are being found to support borrowers,” he stated, adding that firms had made improvements to their processes and supports.

“However, the review also found that the quality of customer service is not yet where it needs to be in the context of the specific challenges for borrowers facing early arrears at this time,” Kincaid continued.

“We found instances of late and incomplete information provided by lenders; unclear website information; inadequate follow up with the borrower; lack of assistance in completing paperwork; and failures to recognise where borrowers were experiencing financial difficulties,” he stated.

‘Plain English’

The Central Bank has set out to firms of the improvements they need to make in these areas.

The regulator has also cited examples of good practice on firms’ websites – including the use of ‘plain English’ paperwork and pre-paid return envelopes, and staff demonstrating empathy and willingness to accommodate borrowers through particularly difficult situations, such as bereavement.

The Central Bank has also encouraged firms to make greater use of temporary Alternative Repayment Arrangements (ARAs) to support borrowers where there is a risk that their situation will get worse during the time needed to gather information and assess the situation.

The review found minimal usage of these types of temporary ARAs in most firms, and it was not always clear in firms’ policies when these arrangements could be used.

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