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FactCheck: Has the number of cases taken by banks over arrears halved in two years?

Brendan Burgess claims there is “no tsunami” of arrears cases now.

DEBATES ABOUT THE housing crisis are raging on and one of the most recent saw Brendan Burgess, founder of AskAboutMoney.com, commenting that the number of legal proceedings issued by banks against customers in arrears has fallen significantly. 

On this segment of RTÉ’s Seán O’Rourke on Wednesday, Burgess joined Cecilia Forrestal of Community Action Network, which had launched a new report about mortgage distress, and solicitor Julie Sadlier. 

The panel referenced a number of figures, including Burgess’ claim about litigation.  

The claim:

There’s no storm, there’s no tsunami – the number of legal proceedings issued has fallen by half over the last two years.

When TheJournal.ie asked Burgess for his source, he said he believes he was referring to figure from the Courts Service.

The evidence

Courts Service data allows for a two year comparison between 2015 and 2017 figures in the Circuit Court – the first port of call with arrears litigation. 

In 2015, there were 5,021 actions relating to mortgage arrears launched. 

At the end of last year, the total number of these actions launched was 3,055

This means that 2017 figures were about 40% lower than those for 2015. 

The litigation numbers did continue to fall in 2018 and Burgess, when he spoke to Seán O’Rourke, said “over the last two years”. So let’s look at some more recent data. 

The Central Bank has published more up to date figures.

According to statistics for the first six months of 2018, legal proceedings issued to enforce the debt/security on a primary dwelling house (PDH) on 1,265 accounts.

In the first six months of this year, rent receivers were also appointed to 1,116 buy to let (BTL) accounts.  However this action is not taken in the courts, so does not count towards litigation figures. Most of the cases before the courts relate to a PDH. 

Now if we take 2016 figures for the same period (the first six months of that year), legal proceedings were issued to enforce the debt/security on a PDH on 3,138 accounts.

This means proceedings figures have more than halved in that time.  

Who is taking the litigation?

Neither the Courts Service data nor the Central Bank figures include a breakdown by lender in the Circuit Court. But we do have some data in relation to High Court actions taken by the five main pillar banks.

In the first six months of the year, 290 mortgage holders were taken to the High Court by these banks:

  • AIB – 47 cases
  • Bank of Ireland – 73
  • Permanent TSB – 102
  • KBC – 45
  • Ulster Bank – 23

The overall number of cases taken in the High Court is also falling – in 2016 it was 370 in the first six months of the year. Arrears will usually have accumulated for a significant amount of time before the matter will make it to the High Court. 

Verdict 

We rate this claim by Brendan Burgess as Mostly TRUE.

A verdict of Mostly TRUE means the claim is close to accurate, but is missing significant details or context. Or, the best available evidence weighs in favour of the claim.

TheJournal.ie’s FactCheck is a signatory to the International Fact-Checking Network’s Code of Principles. You can read it here. For information on how FactCheck works, what the verdicts mean, and how you can take part, check out our Reader’s Guide here. You can read about the team of editors and reporters who work on the factchecks here

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