Repossession of house orders up 50% last year

Specialist lender Start Mortgages had the highest number of repossession and mortgage suits before the High Court at the end of 2007. The company had 171 suits before the court, according to figures released by the Court Services.

GE Capital had 55 suits, Allied Irish Banks had 36, IIB Bank had 30 and Bank of Ireland had 11.

The applications, known as orders of possession, increased by just under 50 per cent in 2007 when 465 were applied for; 311 were applied for in 2006. The most recently available figures show that the granting of such orders, in the Chancery Court, has been growing steadily, from 116 in 2003 to 199 in 2006.

Start Mortgages was established in 2004 and leads the market in specialist mortgages for people who have difficulty securing loans from the traditional banks and building societies. The company is a subsidiary of British-based Kensington Mortgages Plc. It employs 110 staff in Ireland and has provided mortgages to more than 10,000 customers since it began operating here.

Its website states that it offers mortgages to people with irregular employment, poor credit history and variable income.

It also states that although most lenders require self-employed people to produce audited accounts before offering loans, Start Mortgages accepts self- certified income up to €250,000.

Repayment interest rates are assessed on an individual basis, based on the applicant's credit record, repayment history, and employment status. They range from 6.5 to 9.85 per cent.

Michael Culloty, spokesman for the Money Advice and Budgeting Service, said mortgage providers had a responsibility to ensure that they loaned money to people who had the ability to repay.

"We would query how much investigation is done into the ability of their customers to repay," Mr Culloty said. "We would like to see companies spend more time and resources on evaluating applicants, instead of spending it on chasing them through the courts."

The organisation, which has 60 offices nationwide as well as a helpline, has seen an increase in the number of people coming to them with mortgage problems.

He advised anyone experiencing difficulties to approach their mortgage provider before they were approached and to seek independent advice if necessary.

A spokeswoman for Start Mortgages said it strictly adhered to lending guidelines on employment, affordability and repayment capacity and the vast majority of their customers made their repayments on time.

"In situations where a customer ignores numerous letters and phone calls and decides not to engage with us to address their mortgage arrears, we are left with no alternative but to initiate legal proceedings," she said.

The company queried Court Services figures, stating it had only issued 125 High Court summonses to the end of December.

The spokeswoman said the figures did not accurately represent the number of summonses for possession orders issued around the country because some lending agents chose to apply through the Circuit Court instead of the High Court.

Start Mortgages used the High Court as a means of "reducing the time to legal conclusion, thereby protecting equity in the customer's property", she said.