Finance Correspondent KBC Bank Ireland and the Irish Mortgage Holders Organisation (IMHO) have agreed to extend their initiative to provide advice and negotiation services to the bank's mortgage holders who are in arrears or pre-arrears with their home loans.

The service was initially launched in March 2014 for a six-month period and was then extended for a similar period. It has now been extended for another 12 months.

Under the terms of the agreement, KBC mortgage holders receive a free advisory service and independent financial advice on their arrears, and are provided with a facility for negotiation with KBC. The service is designed to provide sustainable solutions to customers to deal with their arrears.

According to David Hall, director and co-founder of the IMHO, some 1,269 packs have been sent to KBC's arrears customers as part of this service.

It has completed 514 deals with the bank with another 71 “in progress” since the initiative began.

Arrears team

“We are delighted that KBC has decided to continue for a further year with this arrangement which has been very successful in providing customers who are in mortgage difficulty with access to free independent help to resolve their mortgage challenges,” Mr Hall said. “The figures for the project prove its value to the borrower and the bank.”

KBC said it had extended the partnership “as it is a beneficial additional channel through which our mortgage customers in difficulty can engage with us.”

KBC mortgage holders are provided with a designated point of contact where they are assisted on the completion of a standard financial statement, a budgeting tool that details monthly incomings and outgoings to assist in framing a restructuring deal.

A proposal is then sent by the IMHO to KBC on the customer’s behalf. All negotiations and contact with KBC takes place through the office of the IMHO. KBC has a dedicated arrears team to engage with the IMHO’s representatives.

The IMHO has a similar arrangement with AIB.