Struggling to meet
your mortgage
repayments?
A guide to dealing with
mortgage repayment
difficulties
Our
commitment
to you
At Bank of Ireland we understand that the current economic
climate may have had an effect on your financial situation. You may
be struggling to pay your mortgage and worrying about making
ends meet. If you are facing this kind of difficulty, please don’t feel
in any way uneasy about coming in and talking to us as soon as
possible. In fact, the earlier you make us aware of your issues, the
sooner we can help you.
We want to assure you that whatever situation you find yourself in, we are committed to
helping and supporting you through any repayment difficulties, to treating you fairly and
finding the most appropriate solution to best suit you.
The first step is to meet with a Mortgage Adviser in your local Bank of Ireland Branch.
Many of our customers have already benefited from their knowledge and experience in
these circumstances, and any conversation you have will be in the strictest confidence.
How we can help you
At Bank of Ireland, we have a five step process called the Mortgage Arrears Resolution
Process (MARP) to help customers whose home mortgage is in arrears or is at risk of
going into arrears. This is part of the Bank’s obligation under the Code of Conduct on
Mortgage Arrears. The code applies to a mortgage taken out on your private dwelling
home or on a property you are renting out, provided the rental property is the only
property you own.
The Code of Conduct on Mortgage Arrears offers you protection. However, it is very
important that you understand that there is an onus on you to work with us in relation to
your mortgage arrears. If you do not actively engage with us in relation to these arrears
and provide us with the information we will ask for as part of the MARP, you will lose the
protections afforded to ‘co-operating’ borrowers under the code.
Step 1: Contact us as soon as possible.
Facing financial problems can very daunting, but remember you are not alone in finding
yourself in this situation. As soon as you become aware of what you are facing - contact
us. We have fully trained staff members who are available to help you every step of the
way. You can call into any Bank of Ireland Branch or, if you feel more comfortable making
the first contact over the phone, call our Arrears Support Unit on 07662 44444.
But first, draw up a budget based on your current income and your spending
commitments. Our ‘Help with your finances’ section on www.bankofireland.com has a
useful Budget Planner which may help you with this. Here you can add up your income
for a typical month and then subtract your bills and other expenses. Have a good look
through this and you may find some areas where you can make some savings.
You can also call the Money Advice and Budgeting Service (MABS) who provide
independent financial advice free of charge. (See ‘Useful Contacts’).
If you have an income protection policy or a mortgage repayment protection policy, you
might be able to make a claim. You should check your policy with your insurance provider.
Step 2: Complete a Standard Financial Statement (SFS)
Your next step is to complete a Standard Financial Statement (SFS), a form specially
designed to provide us with a detailed understanding of your finances. The SFS form is
available from any Bank of Ireland branch and at www.bankofireland.com. Our ‘Guide to
completing the SFS’ will help you in completing it but if you need further assistance don’t
be afraid to contact us.
You might also wish to seek independent advice to help with completing the Standard
Financial Statement - see ‘Useful Contacts’.
The SFS will allow us to fully assess your situation. It is important that you complete the
form fully and accurately providing a full and honest account of your finances. You will also
be required to provide us with additional documentation to support the information you
have provided on the form.
Step 3: Assessment of your situation
When you have returned your completed SFS to us we will use the information to
assess your particular situation and identify an approach to dealing with your financial
difficulties. We will carefully consider your full circumstances taking into account the
overall information that you have provided in your Standard Financial Statement and any
additional supporting documentation we require. We will consider:
•
•
•
•
your total personal debt – that is the total amount of debt that you have, your
mortgage and other amounts owed
your current ability to make repayments, based on all of the information you have
given us in your SFS, including all income and outgoings
your previous repayment history on any loans or mortgages that you have at the
moment or may have had in the past
and any other relevant personal information you have provided to us, such as an
expected change in your employment status for example.
Step 4: Agree the approach
We have a number of potential resolutions that can help you. These may be short term
or long term depending on your particular circumstances, and could include one or a
combination of initiatives from the following list:
the full mortgage repayment required for a period in excess of 12 months. This reduces
the amount of your repayments for a specified period of time.
Short Term Resolutions:
H) Restructure with long term Full Interest
You pay the interest on your mortgage for a period in excess of 12 months. This reduces
the amount of your repayments for the specified period of time.
A) Short Term Interest Only
You pay the interest on your mortgage for a specified period of up to 12 months. This
reduces the amount of your repayments for the agreed period as you do not pay any
amount towards the capital part of your mortgage.
B) Short Term Reduced Repayment
The repayments on your mortgage are higher than interest only repayments but less than
the full mortgage repayment required. This reduces the amount of your repayments for a
specified period of up to 12 months.
C) Moratorium
This is where your full mortgage repayment is postponed for a short period of typically up
to 3 months. You do not make any mortgage repayments for this specified period.
Where any of the above Short Term resolutions are applied, your mortgage
repayments will be recalculated at the end of the specified period and will increase
if your mortgage end date remains unchanged. This will increase your total cost of
credit over the term of your mortgage.
Long Term Resolutions:
D) Term Extension
The term on your mortgage account is extended. This reduces the amount of your
repayments by spreading your mortgage repayments over a longer period of time.
E) Capitalisation of arrears
The arrears on your mortgage are added to the outstanding balance and your mortgage
repayments are recalculated to include the arrears over the remaining term. This means
your arrears are cleared and your repayments will increase if your mortgage end date
remains unchanged.
F) Split Mortgage
We split your mortgage into two accounts to allow you to pay interest-only on one
account and capital and interest on the other account for the remaining term of your
mortgage. The balance on the interest only portion remains the same for the term of
the mortgage and the balance will be due to be paid at the end of your mortgage term.
Before you enter this arrangement you identify the means by which you expect to repay
the Interest Only amount.
G) Restructure with long term Reduced Repayments
The repayments on your mortgage are higher than interest only repayments but less than
I) Deferred Interest Scheme
You pay a percentage of the interest (not less than 66%) for an agreed period of time up
to 5 years. The unpaid interest is deferred until the end of the agreed period. You reduce
your repayments for the specified period of time and the interest that is deferred is added
to your capital balance at the end of the agreed period.
Where options G, H and I above are applied, your mortgage repayment is recalculated
at the end of the agreed period and will increase if the mortgage end date remains
unchanged. These repayments will be higher than if the alternative arrangement is not
put in place. These options may be suitable where you believe and we are satisfied
that your financial circumstances are expected to improve by the expiry of the agreed
period and that you can then meet the increased repayments.
Mortgage Advisory Service - Long Term Resolution Options
Under this Government led initiative you may wish to seek independent advice from a
participating accountant where a long term alternative repayment arrangement is being
offered to you. We will pay up to a maximum of €250 plus VAT to an accountant of
your choice for the provision of this advice. For a comprehensive list of participating
accountants go to www.keepingyourhome.ie and then contact your chosen accountant
to make arrangements for your consultation.
In some circumstances none of the arrangements shown above may be viable and it may
be necessary to sell the property. If this is the case we will work with you to find the most
appropriate approach to best suit your particular circumstances. These include:
J) Mortgage to Rent
Under this scheme you transfer ownership of your home and remain living in it as a tenant
of a housing association. You no longer own the property and pay rent to a housing
association. There are certain qualifying criteria for this option e.g. maximum income
and property values. This scheme may sometimes involve an outstanding amount for
which you will remain liable. The Citizens Information Board operates a Mortgage Arrears
Information Helpline for potential applicants to the Scheme (see ‘Useful Contacts’).
K) Trading Down (MARP)
In certain circumstances we may agree to provide you with a lower mortgage where you
decide to Trade Down to a less expensive property. This may be suitable where the new
mortgage is at a more manageable level, even if your current mortgage is greater than the
value of the property you are selling.
L) Voluntary Sale
This is where we permit you to sell the property yourself and repay your mortgage loan
with the proceeds of sale. If the property is sold for less than the balance outstanding on
your mortgage you remain liable for any outstanding mortgage balance.
M) Voluntary Surrender
This is where, after you move out of the property, we permit you to return the property to
the Bank to sell on your behalf. Here you remain liable for the full mortgage debt and any
outstanding balance after the property is sold by the Bank.
All of the above options are subject to an individual assessment of each case and
need to meet our criteria.
If you currently have a home mortgage on a tracker rate product which relates to your
Principal Private Residence or the only residential property you own we won’t require
you to change from a tracker rate product.
Step 5: Appeals
You have the right to appeal any of the following to the Bank’s Mortgage Appeals Board:
• the decision of our Arrears Support Unit
• our treatment of your case under MARP
• our compliance with the requirements of the Code.
Any appeal must be made in writing to the Appeals Board (see ‘Useful Contacts’) within
21 business days of receipt of our decision notification.
The Appeals Board is required to acknowledge appeals within 5 business days of an
appeal being received. The appeal is adjudicated within 40 business days of the appeal
being received. Decisions by the Board on appeals are notified in writing within 5 business
days of the appeal being heard.
If you are unhappy with a decision of the Appeals Board you have the right to refer the
matter to the Financial Services Ombudsman (see Useful Contacts).
Some helpful hints
Keep in touch
It is important that you keep in touch with us.
Here are some tips to help you through the process:
1. Provide a full and honest disclosure of your financial circumstances
2. Provide supporting documentation when this is requested
3. Contact us straight away if there are any changes to your financial circumstances
4. Reply to us as soon as you can when you receive any correspondence from us
5. Return any phone calls to us promptly
6. Keep appointments that have been made with us.
You may appoint a third party to act on your behalf and deal with us regarding your
financial circumstances.
Understanding your arrangements
When we have agreed your repayment arrangement we will write to you outlining the
terms and conditions that apply to it. If you have any questions about the arrangement,
contact us and we will be happy to discuss these with you.
You should also be aware that, although these options will reduce your home mortgage
repayments, they will add to the overall cost of your home mortgage in the longer term.
It’s very important that you fully understand the implications of any new arrangement
before you go ahead with it – that’s why we will always advise you to take independent
legal and/or financial advice before you make any decisions.
Government Supports
Don’t forget that you can do some research too. There are many independent sources
of advice that you can refer to. You may be entitled to Mortgage Interest Relief and/or
Mortgage Interest Supplement. You can call Citizen’s Information or your Community
Welfare Officer who can advise you of your entitlements (see ‘Useful Contacts’). We can
also meet you together with any third party who you might like to act on your behalf.
The information provided in this booklet sets out some of the Bank’s obligations under the
Statutory Code of Conduct on Mortgage Arrears. Full details of the Code can be found on
the Central Bank’s website (see ‘Useful Contacts’).
Useful Contacts
Bank of Ireland Mortgage Arrears Support
Unit
New Century House,
IFSC
Mayor Street Lower
Dublin 1
Telephone 07662 44444
www.bankofireland.com
Citizens Information Board
The Citizens Information Board is the
national agency responsible for supporting
the provision of information, advice and
advocacy on social services and for
the provision of the Money Advice and
Budgeting Service.
Mortgage Arrears Information Helpline:
07610 74050
www.citizensinformationboard.ie
www.keepingyourhome.ie.
Money Advice and Budgeting Service
(MABS)
MABS is a free confidential and
independent service for people in financial
difficulty
MABS helpline: 0761 07 2000
[email protected]
www.mabs.ie
Central Bank of Ireland
The Central Bank’s website provides
independent information on financial
products and a full copy of the Code of
Conduct on Mortgage Arrears is available
here.
Telephone: 1890 777 777
www.centralbank.ie
Itsyourmoney.ie
Itsyourmoney.ie is under the remit of the
National Consumer Agency. It provides
statutory consumer information and
education functions of the Central Bank of
Ireland.
Consumer Helpline: 1890 432 432
www.itsyourmoney.ie
Department of Social Protection
This website provides information relating
to job seekers allowance, mortgage
interest supplement and other welfare
benefits you may be eligible for.
www.welfare.ie
Office of the Revenue Commissioners
This website will provide you with
information on all tax credits and benefits
you may be entitled to.
www.revenue.ie
Financial Services Ombudsman
The Financial Services Ombudsman is a
statutory officer who deals independently
with unresolved complaints from
consumers about their individual dealings
with all financial service providers.
Telephone 0890 882 090
www.financialombudsman.ie
Mortgage Appeals Board
Bank of Ireland Mortgage Appeals Board
New Century House
IFSC
Mayor Street Lower
Dublin 1
Credit Reference Agency
We may file a report about the performance of your loan with a credit reference agency
if arrears arise on the account and we do not have to tell you before we file the report. If
you are in arrears, such a report could make it more difficult for you to get credit from us
or other financial institutions in future. For example, you may have difficulty getting a new
home/business loan. The credit report we file with the credit reference agency will show
the number of payments you have missed. If we repossess a property, that may also be
shown on the credit reference agency record.
Arrears
If you do not pay us a repayment instalment or other sum of money by the date you were
due to pay it, we may charge you a default interest rate of 0.5% per month or part of
a month (which is 6% per annum) on the unpaid sum. This default interest is added to
normal interest. We do not charge borrowers default interest when they are both (a) in
a Mortgage Arrears Resolution Process under the Central Bank’s Code of Conduct on
Mortgage Arrears; and (b) are co-operating reasonably and honestly with us.
Legal and Consumer Credit Act Warnings and Consumer Protection Code Warnings
WARNING: YOUR HOME IS AT RISK IF YOU DO NOT KEEP UP
PAYMENTS ON A MORTGAGE OR ANY OTHER LOAN SECURED ON IT.
If you are considering a variable rate mortgage:
WARNING: THE PAYMENT RATES ON THIS HOUSING LOAN MAY BE
ADJUSTED BY THE LENDER FROM TIME TO TIME.
If you are considering a fixed-rate mortgage:
WARNING: YOU MAY HAVE TO PAY CHARGES IF YOU PAY OFF A
FIXED-RATE LOAN EARLY
If you are considering an interest-only term:
WARNING: THE ENTIRE AMOUNT THAT YOU HAVE BORROWED
WILL STILL BE OUTSTANDING AT THE END OF THE INTEREST-ONLY
PERIOD.
If your mortgage is an equity release mortgage and is being used for debt consolidation purposes:
WARNING: THIS NEW LOAN MAY TAKE LONGER TO PAY OFF THAN
YOUR PREVIOUS LOANS. THIS MEANS YOU MAY PAY MORE THAN IF
YOU PAID OVER A SHORTER TERM.
For all mortgages:
WARNING: IF YOU DO NOT MEET THE REPAYMENTS ON YOUR
CREDIT AGREEMENT, YOUR ACCOUNT WILL GO INTO ARREARS.
THIS MAY AFFECT YOUR CREDIT RATING, WHICH MAY LIMIT YOUR
ABILITY TO ACCESS CREDIT IN THE FUTURE.
If you choose an endowment loan, and the insurer does not guarantee that the proceeds of the policy will
be enough to repay the loan when due, please note:
WARNING: THERE IS NO GUARANTEE THAT THE PROCEEDS OF
THE INSURANCE POLICY WILL BE SUFFICIENT TO REPAY THE LOAN
IN FULL WHEN IT BECOMES DUE FOR REPAYMENT.
Bank of Ireland Mortgage Bank is a member of Bank of Ireland Group. Bank of Ireland and Bank of Ireland
Mortgage Bank, trading as Bank of Ireland Mortgages are regulated by the Central Bank of Ireland.
37-943R.7(02/13) A5