Three quarters of mortgages in arrears still not restructured

Data also shows marginal rise in buy-to-let mortgages slipping into arrears

An additional 3,855 residential mortgage accounts were restructured in October, while the number of mortgages in arrears of more than 90 days fell by 302 accounts during th emonth, the Department of Finance said today. However, more than three quarters (75%) of mortgages in arrears of more than 90 days, have still not been restructured.

Based on information from the six main banks – AIB, Bank of Ireland, PTSB, ACC, KBC Ireland and Ulster Bank –engagement between consumers and lenders has led to 49,032 permanent mortgage restructures, an increase of 3,855 accounts in October.

Total mortgage accounts in arrears (all arrears 1 day past due) fell during October by 727 accounts, while the number of mortgage accounts in arrears of greater than 90 days decreased from 81,156 to 80,854, a drop of 302 accounts.

Temporary restructures continue to fall, “indicating a move towards a greater utilisation of permanent restructures” the Department said.


The most popular mortgage restructure methods involve a term extension of a mortgage (14,804 accounts); interest only (13,682); and arrears capitalisation (13,093).

With regards to buy-to-let (BTL) mortgages, among the six main banks total mortgage accounts in arrears past one day increased marginally this month, up from 34,192 to 34,237. There was also a slight increase in the number of mortgage accounts in arrears greater than 90 days, up to 26,489.

For BTL mortgages the number of permanent restructures increased by 214 on September, up to 10,020, while restructures of accounts in arrears greater than 90 days, increased marginally, up to 5,391. The predominant restructure type for BTL arrears is temporary interest only, with 8,004 accounts in this category, followed by arrears capitalisation (3,481).

Meanwhile a survey from PIBA, the country’s largest group of financial brokers and covering the third quarter of 2013, showed that interest only arrangements remain the most prevalent option for lenders in coming to an arrangement with mortgage holders, at over 65 per cent. The second most popular resolution was a split mortgage (37.7%), followed by repayment break (15.9%) and debt forgiveness (14.5%).

Rachel Doyle, chief operations officer at PIBA, said that the situation is "still far from desirable".

“We are a long way off what is required. Our brokers are reporting that the interest only arrangements favoured by lenders are not long term solutions for many of those in difficulty. We need to see lenders facing up to the reality that write downs of part of the borrowings is the only suitable arrangement for many who will never be in a position to repay in full,” she said.

Fiona Reddan

Fiona Reddan

Fiona Reddan is a writer specialising in personal finance and is the Home & Design Editor of The Irish Times