THE GOVERNMENT has been accused of dragging its feet in the search for a long-term solution to the mortgage debt crisis as new figures show that one in seven homeowners cannot meet their home loan repayments each month.
According to the latest Central Bank data, 70,911 home loans were in arrears of 90 days or more at the end of December, an increase of almost 8,000 in just three months and up over 21,000 since the end of 2010.
The figures also show that a further 74,379 mortgages have now been restructured, up nearly 5,000 since the end of September. Of the restructured mortgages, 37,582 are also in arrears.
Fianna Fáil’s finance spokesman Michael McGrath said the real picture was worse again as the latest figures do not include those in arrears of less than 90 days.
“We know from information released to the Oireachtas finance committee that some 46,634 mortgages were in arrears of less than 90 days at the end of June 2011,” he said. “Therefore, the actual number of mortgages experiencing some level of distress is likely to be closer to one in five.”
He accused the Government of dragging its feet in its response to the Keane report, which put forward a range of measures aimed at tackling mortgage arrears last September. He also said delays in the passing of a new personal insolvency Bill, which will not become law until the autumn at the earliest, were exacerbating the situation.
The Government denied the charges and Minister for Jobs, Enterprise and Innovation Richard Bruton claimed there were “a lot of proposals being developed which will make a real difference”.
He said measures, including the Keane recommendations and the personal insolvency legislation, would rebalance the relationship between distressed borrowers and the banks.
“The real concern remains the almost complete absence of medium- and long-term solutions to this huge social and economic problem,” said David Hall of New Beginning, which was set up last year to lobby on behalf of people in arrears.
Mr Hall also queried the repossession figures published by the Central Bank, saying they showed only those repossessions that had been completed. He said with the figures putting the combined number of final demand notices and legal proceedings in progress at 12,000, it was “disingenuous” for the Central Bank to quote such small figures.
Sinn Féin’s finance spokesman Pearse Doherty accused the Government of complacency and said its inaction was hurting families.
The Irish Brokers Association’s Ciaran Phelan said: “The record growth in long-term arrears is probably the most alarming statistic in the latest data.” He accused banks of waiting for homeowners to fall into arrears before agreeing to any form of restructuring.
The Irish Banking Federation (IBF) insisted its members were employing a range of measures to deal with distressed borrowers and said they were continuing “to examine what further initiatives can be introduced in the context of the [Keane report]”.
It said while the vast majority of borrowers continued to meet their mortgage repayments, the number of mortgages being restructured was evidence of how lenders are working with distressed borrowers. It noted that the level of repossessions at 17 per 100,000 was low compared to the UK figure of 76 per 100,000.
The federation encouraged those under pressure to “communicate with their lenders in order to find a workable arrangement”.
It also called on the Government to ensure its personal insolvency Bill be introduced in a balanced manner.
Meanwhile, the Central Bank’s director of consumer protection Bernard Sheridan emphasised the importance of consumers struggling with mortgage repayments, or those who fear they will fall into arrears, to make contact with their lender as early as possible.