Irish News

Wednesday 17 September 2014

Home repossessions 'never higher'

Published 02/09/2014 | 11:12

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Banks are losing millions as insolvency deals are vetoed
A man walks past poster graffiti in Dublin, as the latest figures reveal the crisis of long-term arrears for some homeowners is growing

The number of homes being repossessed by banks has never been higher, official data has revealed.

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While the total mortgage arrears' figure has fallen 5%, the long-term debt crisis is growing along with the number of families facing legal battles to keep a roof over their heads.

The Central Bank reported 299 houses and apartments were seized by the banks or voluntarily surrendered from March to June this year - the largest quarterly figure since records began in late 2009.

The mortgage review also showed that 1,752 homeowners are now behind in repayments for almost two years.

And with the property market recovering in Dublin and parts of other cities, banks are now driving legal actions and repossessions - with 3,274 applications initiated in the courts in the three months to June.

Flac director general Noeline Blackwell said the report matches trends advisers have seen.

"We find that more of our contacts are from people who are in deeper difficulty, giving rise to a worry that those who became seriously over-indebted at the start of the economic crisis are not pulling out of difficulty now, but rather becoming mired more deeply," she said.

Some 3,131 privately-owned homes or apartments have either been repossessed by the banks or voluntarily handed over to a lender since late 2009.

The Central Bank said that since the end of last year there has been a significant increase in repossessions - 168 for the last three months of 2013, to 281 in the first three months of this year, and up to 299 in June.

Its review of arrears revealed an outstanding balance of 12.5 billion euro remains to be paid to banks for mortgages.

And campaigners for debt relief warned that as many as 90,000 people are now being threatened by homelessness because of mortgage arrears and the banks' approach.

The Central Bank noted a significant decline in mortgages classed as early arrears - 90 days or less. Some 35,662 accounts were in this bracket at the end of June - a fall of 8.8% on the previous quarter.

David Hall, chief executive of the Irish Mortgage Holders Organisation (IMHO), described it as a declaration of war by banks which sat back for years and failed to help distressed borrowers.

"The number of people potentially facing homelessness through inaction in tackling arrears could now be 37,066," he said.

"This does not include children or partners of the people with the mortgage."

Mr Hall said the latest figures bore out a series of previously identified, significant but unresolved time bombs in the mortgage market.

The Central Bank report revealed further detail on the extent of mortgage debt:

:: 16.5% of the country's household mortgages are behind with repayments - 126,005.

:: 90,343 privately held accounts were in arrears for 90 days or more at the end of June, a fall of 3% on the last quarter.

:: In the rental sector, 9.4% of buy-to-let landlords' accounts - 14,536 mortgages - are in arrears for 720 days.

:: 101,973 mortgages in the residential market have been restructured at the end of June - an increase of 10% on the previous three months.

:: 296 repossessions were also ordered by the courts between March and June.

The buy-to-let sector is not escaping the increasing level of repossessions either.

The Central Bank said 550 landlords' properties have been repossessed or surrendered to lenders since statistics were officially recorded in the autumn of 2012.

These legal actions also peaked in the latest report with 97 taken from borrowers between March and June this year.

Pearse Doherty, Sinn Fein finance spokesman, accused the Government of refusing to deal with the mortgage crisis.

"It is frightening to think that the financial pressure created by this situation is negatively impacting more lives than the number of people who filed into Croke Park to watch the All-Ireland football semi-finals at the weekend," he said.

"That is the scale on the crisis at it stands. It cannot be hidden by the Government spinning a slight reduction as a success."

Mr Doherty said any falling figures in the report were no cause for celebration.

"This Government is content to let the mortgage crisis unwind at the pace of the banks' choosing. The increase in long term arrears points to this fact," he said.

Press Association

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