| 13.8°C Dublin

142,000 homeowners in 'serious debt' with arrears on mortgage

A MASSIVE 142,000 mortgage-holders are now seriously falling behind with their monthly payments, the Central Bank has revealed.

The number of mortgages in difficulty continued to rise in the first quarter of 2013, the figures outlined.

More than one-in-10 mortgages are now 90 days overdue. And almost 26,000 homeowners have been in arrears for close to two years.

Representative groups have slammed the Government's failure to address the serious issue.

BANKRUPTCIES

Solicitor and co-founder of New Beginning, Vincent P Martin, said that the organisation has been holding back in the hope that the banks would implement sustainable solutions, and that large-scale bankruptcies are being seriously considered for the first time.

"The time has come for an independent organisation like New Beginning to take action and demonstrate to the banks and the Government that enough is enough," he said.

"Today's figures reveal that not only is the number of arrears steadily rising, but the banks are clearly relying on farcical, unsustainable short-term arrangements, preventing real economic recovery."

Mr Martin said that 24,706 new restructure arrangements were put in place between January and March of this year. The majority of these – a massive 55pc – are interest-only and reduced-payment arrangements.

"This is not solving the problem, it is not making distressed homeowners solvent, which is condemning Ireland to economic ruin," he said.

"People are in arrears because their mortgages are not sustainable. Unless deals are done to make these people solvent, there will be no additional monies circulating in the economy." The head of the Free Legal Advice Centre (FLAC), Noeline Blackwell, said that the Government is failing to protect distressed borrowers and has, instead, focused attention on protecting the State's banks.

There are 95,000 households in very serious difficulties, and that equates to hundreds of thousands of people, which is a very big problem in a country of this size and is not going to be just a debt problem, but a major housing issue too.

VULNERABLE

Ms Blackwell said the banks had got every single thing they wanted in the new code of conduct.

Under the code, a current 12-month moratorium on legal action, which protects homeowners vulnerable to repossession, is to be removed, and any houseowner who leaves the Mortgage Arrears Resolution Process will have two months before legal action can be taken against them.

The Central Bank said that, in the first three months of the year, more than 18,200 home loans are in arrears of between 90 and 180 days.

And more than 77,349 mortgages are falling into arrears of more than 180 days, it said.

hnews@herald.ie


Privacy