Courts Service to get powers to overrule banks on debt deals
THE Courts Service is to be given powers to overrule banks that pull the plug on debt deals.
The Government's long- awaited mortgage arrears package will also expand the role of the Money Advice and Budgeting Service (MABS) in helping borrowers in arrears.
And the proposals will introduce changes to the Mortgage to Rent Scheme in a bid to make it more accessible to homeowners.
The package of mortgage relief measures was finally agreed by the Cabinet after months of negotiations.
Central to the package is the establishment of an appeals process for homeowners whose debt deals have fallen through.
It is hoped that the so-called examinership-type model will represent a major step towards ending the banks' stranglehold on the personal insolvency service.
Under the Government's plans, banks will be forced to accept deals proposed by Personal Insolvency Practitioners (PIPs) if the courts deem them reasonable.
The legislation underpinning the new process will be enacted before the Dail's summer recess.
Speaking at Government Buildings, Justice Minister Frances Fitzgerald said the examinership model is significant.
"If he (the judge) thought the deal was fair and reasonable, the court would be in a position to impose the solution," said Ms Fitzgerald.
"We would hope, in fact, that cases wouldn't have to go to court. But this would serve as a strong motivation for everyone to reach a deal without the court process. But the court process is now there and clearly can be used to im- pose a settlement," she said.
But reacting to the measures, the Opposition labelled the plan as "timid" and "lacking ambition".
"A huge amount of unnecessary distress has been heaped on families as a result of the failure to address this issue," said Fianna Fail finance spokesperson Michael McGrath.
Meanwhile, Finance Minister Michael Noonan said he has the option of increasing the levy on banks that refuse to pass on interest rate reductions to variable rate customers.
In a report, the Central Bank is understood to have said the Government should not interfere with the setting of rates.