New research on Mortgage Repayments after Permanent Modification in Ireland

[Brendan Burgess]

New research on Mortgage Repayments after Permanent Modification in Ireland
The Central Bank of Ireland today publishes a new Economic Letter ‘Mortgage Repayments after Permanent Modification’ (Economic Letter Vol. 2014 No.7).
This Letter examines mortgage repayment patterns after permanent modification in Ireland. It focuses on any primary dwelling house loan that has experienced at least 90 day arrears since December 2010 and has received a permanent modification during that time.
The main findings of this research include:

• The stock of permanently modified loans is growing faster than the stock of loans in default, suggesting that institutions are making progress in addressing the arrears problem.
• The stock of permanently modified defaulted loans making full repayments on their modified mortgage amount has increased to 55 per cent from 28 per cent in the 3 years to December 2013.
• The persistence of full repayment after permanent modification has improved over time. Of loans permanently modified in Q4 2012, 60 per cent continued to make full repayment a year later, compared to 44 per cent of loans modified in Q4 2011.
• Approximately 11 per cent of permanently modified defaulted loans consistently make no repayment after modification.

 

[Brendan Burgess]

I think that this topic is very complex and difficult to explain.

I have read the Newsletter and I am a bit overwhelmed by the numbers.

If I understand Table 2 correctly...

Of those who had been restructured at Q4,2012 , 65% were paying the full restructured amount a year later.