Conscious of the difficulties that many homeowners face in meeting their mortgage commitments, a number of Government Departments, State agencies and mortgage lenders have worked together and have developed an initiative called the Mortgage Arrears Information and Advice Service.
If you are in mortgage arrears, or think you are at risk of going into arrears, the Mortgage Arrears Information and Advice Service can help you understand your options.
The service has three elements, which are set out below. The first two largely aim to inform, while the third aims to provide a measure of advice.
While it is not legally binding, the Protocol has nevertheless been formally drawn up by, and between, various accountancy bodies which represent and regulate accountants, various mortgage-lenders, Government Departments, including the Departments of Finance and of Social Protection, and the Central Bank. It sets out those parties' intentions with regard to the availability to borrowers of specified financial advice which is provided at the cost of mortgage-lenders.
This document aims to explain the scope, extent and type of advice available under the Protocol.
A key theme in the Mortgage Arrears Information and Advice Service is that of engagement between borrower and mortgage-lender. It seeks to ensure that borrowers are informed, encouraged and empowered in relation to contacting their mortgage-lenders.
If you do engage with your lender in relation to mortgage arrears, your lender may suggest and present you with a particular long-term resolution proposal for consideration. Such a proposal might suggest, for example, a split mortgage, extension of the mortgage term, trade-down forbearance, a mortgage-to-rent scheme, or similar.
At the stage of putting such a proposal, your lender should advise you that you should seek independent advice on it. While the advice you need may include legal, investment, taxation, or other professional advice, you will in any event need financial advice. (In connection with advising you to obtain advice, lenders have obligations under the Central Bank's Consumer Protection Code 2012 and its Code of Conduct for Mortgage Arrears. The Protocol makes it clear that it does not have any effect on lenders' obligations under these Codes, or generally.)
Under the Protocol, your lender will advise you to take independent financial advice on its proposal.
Lenders that have signed up to the Protocol will also advise you that, if you wish, you may avail of an option of obtaining a specified level of independent financial advice on the proposal, to the value of 250 plus VAT, which will be paid for by the participating lender. That specified advice, paid for by the participating lender, is available from accountants who participate on a panel of accountants drawn up for this purpose under the Protocol. If you wish to obtain the specified financial advice under this option, you are free to choose any accountant from the list on the panel, and he or she will provide the advice directly to you, and be paid 250 plus VAT by your participating lender. Apart from payment, there is no relationship between the lender and the panel-accountant, and you will be the accountant's client at all times during the process. Also, under the Protocol, the accountant is specifically stated not to be liable to the lender in respect of any advice provided to you, or in respect of any decision that you might make in relation to the lender's proposal.
If you wish to avail of this option, you should read the Protocol carefully to ensure you understand the scope, extent and nature of the financial advice that will be provided (and the advice that will not be provided) for the 250 plus VAT that will be paid by your participating lender.
The paid-for financial advice available under the Protocol is not necessarily all the financial advice you may need in relation to your lender's proposal. Nor is that advice necessarily all the advice you might otherwise need in relation to your position or options generally in light of that proposal. These might include further, or other advice, including legal, investment or taxation advice. (See below, under the heading, "The scope of advice offered", for further general information on the scope and limitations of the specified financial advice available under the Protocol).
You are not required to avail of the paid-for financial advice option provided by a participating lender under the Protocol. However, if you do avail of it, there is also nothing to stop you availing of this paid-for option and seeking further (or other) 'top-up' advice. This can be sought from the same accountant and / or from a different accountant, or from other advisers (including legal or taxation advisers, for example). However, any 'top-up' advice will be at your own cost. There is also nothing to stop you seeking advice from your own accountant (or from another adviser, or other advisers). If your own accountant is on the panel, you are free to select him or her, and a participating lender will pay him or her 250 plus VAT for the financial advice specified in the Protocol.
The option of obtaining financial advice that is paid for by the participating lender under the Protocol is available to you only once. Therefore, if your reject a particular long-term mortgage-resolution after you have obtained the paid-for advice, your lender will not hold out the option of further paid-for advice under the Protocol in relation to any new resolution proposal it might subsequently suggest to you.
The particular financial advice available from accountants on the panel on a paid-for-by-lender basis is summarised in the Protocol, under the heading, "Protocol". While the Protocol summarises the general scope of the paid-for financial advice, the particular scope, nature and extent of the advice to be given should also be clearly set out in the letter or terms of engagement provided to you by any panel-accountant you retain.
Under the Protocol, panel-accountants aim to provide the specified advice at a meeting, or possibly two. They aim do this within two weeks of being approached, where possible.
During the meeting(s) with the panel-accountant, the accountant will explain technical terms and language used in the proposal, and will help you to assess the financial implications of the long-term resolution options being offered by your lender.
For example, the accountant will advise you on certain implications of the options being presented. These implications include, for example, the revised cost of servicing the debt, the new term of the loan, the new interest rate, other on-going financial implications, what will happen when the arrangement finishes, the implications of default, and similar.
The specified, paid-for advice provided by accountants on the panel is financial, rather than legal, or other advice (for example, taxation advice). Further or other advice (including legal or taxation advice) may be desirable generally.
Also, under the Protocol, the paid-for advice will not include investment advice or mortgage advice, within the meaning of the Investment Intermediaries Act 1995 or the Consumer Credit Act 1995, respectively.
Further, under the paid-for advice, the accountant will not specifically advise you either to accept, or to reject, your lender's proposal.
Finally, the scope of the paid-for advice is limited to the mortgage secured on your primary residence.
Participation on the panel is promoted by various accountancy bodies amongst their members, and a list of participating accountants has been prepared.
Accountants who hold practising certificates from their professional and regulatory bodies can confirm to these bodies that they wish to be part of the panel. Such practising accountants operate within a regulatory regime which includes oversight and regulation of their conduct and performance by their professional bodies, and, ultimately, by the Irish Auditing and Accounting Supervisory Authority.
The list of accountants on the panel in each county is available on the Citizens Information Board website, keepingyourhome.ie.
Lenders are not involved in the process of selecting accountants for the panel.
If you decide not to engage with the long-term resolution proposal offered by your lender, and you wish to use the debt resolution mechanisms under the Personal Insolvency Act 2012, you may need to seek the advice of a Personal Insolvency Practitioner. In order to avoid any possible conflict of interest, the accountant who provides financial advice for you will not be permitted to accept a Personal Insolvency Practitioner role for you.
You can find an accountant in your area from the links below.
Find an accountant in Ireland by county:
Find an accountant in Northern Ireland: