The Free Legal Advice Centre (Flac) has said any code of conduct for banks on mortgage arrears negotiations should be set on a firm legal footing.
And those dealing with banks must be afforded legal and financial advice as well as recognition of a need for basic living expenses.
These are among 14 suggestions submitted to the Central Bank on the Code of Conduct on Mortgage Arrears by the organisation. The deadline for submissions is today.
Flac general director Noeline Blackwell said the conduct of financial institutions, as based on the guidelines, should be legally enforceable in cases that end up in court, in effect binding them to the steps set out by the Central Bank.
The guidelines would "to a great extent" guide people in their negotiations with lenders, and it was important the lenders were obliged to follow them, she said. If put on a legal footing it would mean that when a bank decided to go to court "you can say [they] can't do that because [they] haven't complied with the statutory instrument".
The submission also stresses the importance for access to free advice; many of the current bodies like the Money Advice and Budgeting Service (Mabs) are already unable to process existing demand.
“Where are borrowers in arrears to obtain the ongoing financial, debt and legal advice from the State that they require to negotiate on some kind of level playing field with their creditors and to make sustainable and workable decisions for them and their dependants?” the submission asks.
Ms Blackwell, speaking ahead of the body's submission launch today, said there must be a reasonable regard for living expenses on the part of those in financial dire straits.
“It is Flac’s experience that many households in the current crisis have felt so pressurised by their creditors, particularly mortgage lenders, they are paying an undue percentage of their household income towards their credit commitments,” the submission says.
“In many instances, this has left the household short of money for essential food, heat, light and other services, and this has subjected many to unacceptable levels of deprivation.”
