The lenders were written to by the Financial Regulator today informing them the new measures will come into effect from 17 February this year.

The measures now cover sub prime lenders, which had not been covered by a voluntary code of conduct.

In a statement, the Regulator said ‘the 12 month requirement does not apply where the borrower is deliberately not engaging with the lender.’

It added ‘The Financial Regulator is of the view that lenders should only seek repossession in less than 12 months in very exceptional circumstances and when all reasonable attempts to encourage engagement by the borrower have failed.’

Companies which fail to comply face the threat of fines of up to €5 million.

However depositors have objected to the scheme and say they are being treated unfairly.

They want the High Court to change their status as creditors which could mean they receive 6% in refunds.

One depositor told the court to be offered a 1% refund was ‘an insult’.

Many said they had lost their savings and could no longer qualify for a mortgage. The case is ongoing.

The figures for April from the Central Bank confirm the property market has slowed to a trickle.

It is the first time that repayments on existing mortgages has been greater that new mortgage lending since the Central Bank began this monthly statistics series in 1990.

The figures show that overall, mortgage lending fell by over €100m last month.

The amount of money loaned out in the rest of the economy also fell, reflecting concerns raised by many business groups about accessing credit.

People are also spending less on credit cards. The amount of money spent on credit cards by consumers in April fell by €180million compared to April of last year.

The Bill will set new standards for the operation of management companies and new rules for developers who build apartments.

Fine Gael welcomed the Bill, but said it was long-overdue.

Measures in the Bill include developers having to set up an ‘Owners Management Company’ prior to the sale of apartments.

It means that prices nationally have fallen by almost 5% in the first four months of this year.

The average price paid for a house nationally in April 2009 was €248,640, compared with €261,573 in December and a peak of €311,078 in February 2007.

Houses in the first-time buyer category are falling at the fastest rate, down 7.9% already this year.

Niall O’Grady of Permanent TSB said: ‘This is the fastest rate of decline in national prices that we have seen to date since the index started in 1996.

‘The particularly dramatic reduction in prices for first-time buyers reflects their reluctance to buy in a market that is still declining and where unsold properties are being reduced further’

In the April Budget the tax relief was limited to homeowners in the first seven years of their loans.

Revenue is now asking 134,000 homeowners to clarify when their loans started to establish whether the relief still applies to them.

Before last month’s budget around 560,000 people qualified for mortgage interest relief.

Half of those receiving it had the relief stopped, of these 154,000 have been deemed ineligible.

Homeowners who are in this category are asked to take no action until Revenue contacts them.

Homeowners will be able to update details on www.revenue.ie or through their local tax office.

It also said mortgage arrears in Ireland were climbing and stood at 2% of total mortgage loans at the end of March, compared with 1.5% at the end of December.

However, AIB said that when the bad debt charges were excluded its trading profits so far this year were ahead of the same period last year.

Church of Ireland finances were being discussed by members gathered in Armagh for the General Synod.

But it was the fallout from the global economic crisis that the Primate of All-Ireland turned his attention to.

Referring to the role played by bank directors and executives, Archbishop Alan Harper said it was not acceptable that high-risk strategies should be allowed to threaten the deposits of customers and the investments of shareholders.

He said those in charge of financial institutions who were responsible for the economic crisis should consider their positions.

He also called for a new ethic internationally to replace the flawed economic ethics of the past.

There was a lively debate on education issues on both sides of the border.

Synod members expressed their anger about the implications for the financing of Protestant secondary schools in the Republic in areas such as Cork arising from changes introduced in the October budget.

The Synod concludes tomorrow, the first time it has been held over a weekend.

For more information from Revenue
According to the Revenue Commissioners, as of the end of last year, there were 562,000 people receiving mortgage interest relief.

However the entitlement is to be suspended from 1 May for everyone except first-time buyers.

The move follows the announcement by the Government in it is supplementary Budget to limit mortgage interest relief to seven years.

Last night Opposition parties in the Dáil accused the Government of creating confusion over the issue.

Under the new system the tax relief on monthly mortgage interest payments will only apply for the first seven years after someone buys a property for use as their home.

According to the Revenue Commissioners, the move means mortgage interest relief will be suspended for 321,000 of the 562,000 people currently receiving the entitlement.

Of those, Revenue says 57,000 people will definitely no longer be entitled to it.

It says it is in the process of working with mortgage lenders in establishing who is and who is not entitled to the relief.

Mortgage holders who have the relief suspended but are entitled to continue to receive it will have it reactivated in June, all arrears included.

220,000 first time buyers will not be affected by tomorrow’s move and will continue to receive the entitlement.

The Cabinet will meet in Government Buildings this morning for a final discussion on the Budget, but at this stage the decisions have already been taken.

After ten sessions, Ministers hope they have a package that can start the recovery of the national finances and will commend itself to the public and the international markets.

Last night, Minister Lenihan said the tax base had declined dramatically and has to be repaired.

He said everyone will make some contribution, though those who have the most will pay the most.

Mr Lenihan is keenly aware that taking too much money out of the economy could create a deflationary spiral, while not taking enough may lead international markets to doubt the Government’s resolve.

The Budget is expected to set out a three- to four-year framework for restoring the public finances.