One in 10 homeowners are still behind on mortgage repayments

Fiona Reddan

About one in 10 family homeowners are behind with repayments on their mortgage, new figures from the Central Bank show,with financing on almost one in five investment properties in arrears. The figures come as the Government finalises its mortgageto rent scheme, which is expected to keep thousands of families currently under threat of eviction in their homes.

According to figures published on Tuesday from the Central Bank, mortgage arrears continued to fall in the second quarter of the year. A total of 73,706 family home mortgages (10 per cent of the total) were in arrears at end-June, a decline of 3.6 per cent relative to March 2017.

The number of family homes in arrears over 90 days at the end of June was 51,750, representing 7 per cent of total mortgages. The trend is downwards however; the quarter-on-quarter decline was 2.5 per cent, while this marks the fifteenth consecutive decline in the number of family home mortgages in arrears over 90 days.

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A significant number of family home mortgages have also been restructured, with the figure as of end-June of 120,398. Of these, 87 per cent were deemed to be meeting the terms of their current restructure arrangement, up slightly from the previous quarter.

On the investment side, some 19 per cent of buy to let mortgages were in arrears as of end-June, with those in arrears over 90 days decreasing by 1.9 per cent during the second quarter. Some 14,000 investment mortgages were in arrears over 720 days, with an outstanding balance of € 4.1 billion, equivalent to 18 per cent of the total outstanding balance on all BTL mortgage accounts.

Non-bank entites, such as private equity funds, now hold 48,199 mortgage accounts, accountingfor 6.5 per cent of all mortgages in Ireland, and five per cent of family homes. Of this number, 63 per cent are held by regulated retail credit firms, with the remainder held by unregulated loan owners. Some 41 per cent of family home mortgages held by unregulated loan owners are in arrears of over 720 days, compared to 17 per cent of accounts held by retail credit firms.

Legal proceedings

During the quarter, 340 family homes were taken into posssession by lenders, either on foot of a court order,or voluntary surrender or abandonment, down from 370 properties in the prvious quarter. At the end of the second quarter, there were 1,739 family homes in lenders’ possession, down from 1,740 at the start.

When it comes to investment mortgages, a total of 207 properties were taken intopossession by lenders during the quarter, 77 of which were done so on foot of a court order, while the remaining 130 were voluntarily surrendered or abandoned. Some 195 properties were disposed of during the quarter, meaning that lenders were in possession of 635 properties as of end-June.