More than 118,000 behind in mortgage payments

Almost 20 per cent of mortgage holders are still unable to meet their full mortgage repayments, and 81,156 are more than 90 days in arrears, according to new figures from the Department of Finance.

While Ireland’s six main banks upped their pace of permanent mortgage restructures in September, more than three-quarters of mortgages more than three months in arrears have yet to be restructured.

The figures cover 698,809 mortgages at AIB, Bank of Ireland, ACC Bank, Permanent TSB, KBC Ireland and Ulster Bank, and show 118, 438 were in arrears at the end of September. That marks a slight improvement from the end of August when 120,754 mortgages were behind in their payments.

While 18,513 mortgage holders more than 90 days in arrears have entered into permanent or temporary restructures, 62,643, or 77 per cent, have yet to be restructured. While the banks increased the total number of permanent restructures by 3,900 in September, the number of temporary restructures granted was down by 1,485 between August and September.

Restructurings

Including those with arrears of less than 90 days, 45,177 homeowners had been granted a permanent restructure of their loan while 28,365 had been given a temporary restructure.

Details of restructurings that have been agreed show that banks remain loath to write off mortgage debt, preferring to extend the term of the loan or grant a period of interest-only payments. Furthermore, the number of repossessions were absent from the figures.

Of those borrowers who had agreed a permanent restructure, an extension of the term of the mortgage was the most popular solution agreed. Some 14,914 (33 per cent) of those who had their loan restructured had the term extended.

An interest-only period was agreed with just 3.5 per cent of restructuring homeowners while split mortgages were agreed with 3,688 mortgage-holders (8.1 per cent).

With regard to temporary restructures, some 52 per cent of homeowners opted for interest only repayments, while 2,497 were granted payment moratoriums.

Set targets

The Department of Finance said the number of accounts in arrears had fallen by 2,316 (2 per cent) between August and September. The number of mortgage accounts in arrears of more than 90 days fell by 1,468.

However, the number of mortgage accounts in arrears of more than 90 days that have not been restructured increased between August and September.

Under the Central Bank’s mortgage arrears plan, Ireland’s financial institutions have until the end of December to reach “concluded arrangements” with 15 per cent of customers more than 90 days in arrears. The banks can write down debt, reschedule the loan, put a new payment plan such as a split mortgage in place or repossess the home.

The Central Bank has also set targets for the end of March 2014 for banks to offer sustainable solutions to 70 per cent of customers in arrears of more than 90 days and concluded solutions to 25 per cent.

This article was amended on November 15th, 2013.