About 2,000 Ulster Bank mortgage arrears customers who have yet to engage with the bank about a possible restructuring of their loan are to receive a new communication urging them to talk to the lender.
Ulster Bank has sent a one-page note to customers with six “commitments” on how the borrowers will be treated. This includes a commitment that their homes will not be repossessed if revised repayment terms can be agreed and offers the possibility of residual debt being written off in the case of voluntary sales.
But it also warns customers who are more than 90 days behind with their payments that they could face legal action to have their homes repossessed if they do not engage with the bank, which is a subsidiary of British lender Royal Bank of Scotland.
The commitments include a signal from the bank that it will deal with any “reputable” third party representative appointed by the borrower. If the bank agrees there is a “reasonable chance” of an arrears customer repaying their loan, it “may offer” a combination of reduced repayments, reduced interest rates and/or a longer time to repay the loan.
The bank says it will “look sensitively” at what is reasonable for a customer to repay each month and if terms are agreed “we will not seek to repossess your home”.
Arrears customers are informed that if the house is sold, the bank will “work with you to agree a fair process to address your obligation to pay any residual debt”.
If the home is sold and the borrower qualifies for social housing, Ulster Bank will not chase them for the residual debt.