Friday 2 December 2016

70pc of mortgage arrears cases still unresolved

Published 15/05/2015 | 02:30

The stubbornly high level of arrears is one of the factors that has prompted the Government to weaken the veto banks have over formal debt deals that are part of the Insolvency Service
The stubbornly high level of arrears is one of the factors that has prompted the Government to weaken the veto banks have over formal debt deals that are part of the Insolvency Service

Banks continue to deal with mortgage arrears at a slow pace, new figures show.

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The number of residential mortgage arrears cases that have been restructured fell by just 451 in March, figures released by the Department of Finance show.

The stubbornly high level of arrears is one of the factors that has prompted the Government to weaken the veto banks have over formal debt deals that are part of the Insolvency Service.

There were 58,000 mortgage accounts that were three months or more in arrears at the six domestic lenders. But more than 41,000 of these have yet to be restructured.

This means seven out of 10 troubled mortgages have yet to be sorted out by AIB, Bank of Ireland, Permanent TSB, ACC, KBC Bank and Ulster Bank.

Meanwhile, banks have been accused of trying to subvert the Insolvency Service by bringing in a British debt charity to do deals with householders unable to meet their repayments.

The banks are in negotiations with the StepChange organisation, in a bid to get those with multiple debts to engage with them through it. But the Association of Personal Insolvency Practitioners (APIP) said those in debt default should steer clear of StepChange.

Charity

Chairman of APIP Eric Hendy said: "It would not be in the interests of Irish debtors to engage with a UK charity that is not familiar with Irish insolvency issues and funded by the banks."

And David Hall of the Irish Mortgage Holders Organisation said banks were trying to avoid their heavily indebted customers using the Insolvency Service.

"The banking lobby is attempting to establish its own, de facto insolvency system by engaging with a British debt charity that has no experience dealing with secured debt and with staff who have no knowledge of the Irish market."

A spokesman for the Irish Banking and Payments Federation said it was in advanced discussions with StepChange to provide free and independent advice to distressed borrowers.

StepChange said it has over 20 years of experience in dealing with complex debt problems. "We have pioneered a system of delivering high-quality, free and independent debt advice over the phone and online, and last year we were contacted by nearly 600,000 people. Our advice is always based solely on what is in the best interests of our clients," it said.

Irish Independent

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