3.3% of mortgages in arrears for over 3 months

Brendan Burgess

Brendan Burgess

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The Financial Regulator has issued new information today on [broken link removed]


26,271 mortgage accounts, or 3.3%, were in arrears for more than 90 days of which 17,767, or 2.2%, were more than 180 days in arrears. By value €4.8 billion was owed in relation to all accounts more than 90 days in arrears and €3.2 billion was owed in respect of accounts more than 180 days in arrears.
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This strikes me as very low - the public perception is that the courts are packed out with repossession orders. And there are many people asking for advice on how to deal with arrears on Askaboutmoney and from MABS.

97% of people are either not in arrears, or not in serious arrears which is odd given the following recent factors:

  • very high mortgages
  • high unemployment
  • the increases in taxation
  • reductions in salary
  • business owners suffering
Of course these are counterbalanced by the very low interest rate and the willingness of lenders to make mortgages interest only and to reschedule arrears.

When interest rates rise, the level will increase, but then maybe the economy will have picked up by then.
 
Brendan said:
When interest rates rise, the level will increase, but then maybe the economy will have picked up by then.
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I think that's the main area of concern for the little people (i.e. non-NAMA related). When interest rates rise, people will suffer a whole lot more, as I can't imagine there being wholesale wage increases with an increase in economic activity.

I know myself there's only so far a hike in interest rates I can afford (some way off yet though thankfully).
 
Kine said:
When interest rates rise, people will suffer a whole lot more, as I can't imagine there being wholesale wage increases with an increase in economic activity.
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+1. I know many peole that have seen the mortgage repayments drop by 300 to 400 euro a month with the lower interest rates. If the ECB rate gets back to 4 or 5% in the next couple of years I cannot see wages rise to match the increase in mortgages repayments.
Also there is the probability of rate rises on variable rates independent of ECB rate increases.
Add in the potential of a property tax and the worse may have yet come for many homeowners.
 
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