# Mortgage arrears continue to fall



## Brendan Burgess (8 Jun 2017)

The Central Bank has issued its Quarterly Arrears report for 31 March 2017 



The percentage of borrowers in arrears over 90 days has fallen from 12.9% at the peak to 7.2% now - a drop of 44%.


----------



## Brendan Burgess (8 Jun 2017)

New legal proceedings remain low and continue to fall.


----------



## Firefly (8 Jun 2017)

Hi Brendan,

Whilst the over-all picture looks good, it's interesting to note the change in the make-up of those in arrears. From the graph, in Sept 2012, approx 25% of those in arrears were in arrears for more than 720 days (About 4,000 cases out of about 16,200). Yet in Mar 2017, approx. 72% of those in arrears were in arrears for more than 720 days (about 7,000 out of about 11,000). So not only is the proportion of those in arrears for for more than 720 days increasing, the numbers too. There are approx double the number of cases where people are in arrears now than in Sep 2012. (8,000 vs 4,000). My numbers are not exact and taken from holding my phone as a ruler to the screen but you get what I mean!

Am I reading this correctly?


----------



## Sarenco (8 Jun 2017)

The number of accounts in arrears for over 720 days (2 years) fell by 1.5% over the quarter.  

1.5%!!

And on it goes...


----------



## Brendan Burgess (8 Jun 2017)

Hi Firefly

You are looking at the amounts in € rather than the number of accounts.

In September 2012, there were 19,541 accounts in arrears over 2 years.

It rose to 38,043 at the peak in September 2015.

It was 32,953 by March 2017 - 13% down from the peak.

With unemployment well down, one would have expected these to drop significantly. The fact that they are down by only 13% strongly suggests deliberate default in many, if not a majority, of those cases. 

Having said that, if you fall into two years arrears and then start resuming full repayments, you stay in arrears until you pay them off or until the bank capitalises them.  So it's probably very difficult to get out of this category unless you engage with the lender and the lender is flexible. 

Brendan


----------



## Brendan Burgess (8 Jun 2017)

The bit which I can't really understand is that although there are about 27,000 borrowers in arrears over two years (32,953 accounts), there are only around 11,000 cases outstanding in the courts.  In any other country, there would be legal action progressing against anyone over one year in arrears. 

Brendan


----------



## Sarenco (8 Jun 2017)

Brendan Burgess said:


> The bit which I can't really understand is that although there are about 27,000 borrowers in arrears over two years (32,953 accounts), there are only around 11,000 cases outstanding in the courts.


I would imagine a significant number of those cases are earmarked for Minister Coveney's nutty "mortgage-to-rent" scheme.

The extent and degree of forbearance shown to defaulting borrowers here really is remarkable.  No other country maintains statistics for arrears in excess of two years for the simple reason that they don't exist!  Arrears of that nature simply wouldn't be tolerated anywhere else. 

This, of course, results in higher mortgage rates.


----------



## Firefly (8 Jun 2017)

Brendan Burgess said:


> Hi Firefly
> 
> You are looking at the amounts in € rather than the number of accounts.
> 
> Brendan



Spot on, thanks.


----------

