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Work to do on mortgage restructuring as long-term arrears remain high

The Department of Finance has begun to publish monthly reports on mortgage restructuring.
Oct 31st 2013, 4:54 PM 5,312 12

OVER THREE-QUARTERS of mortgages in arrears of 90 days are more have not been restructured according to the Department of Finance.

The figures up to the end of August are for the six main banks and relate to the primary houses that are part of the Central Bank’s mortgage arrears resolution targets.

In total, almost 700,000 homes are part of the process with 83 per cent performing as per arrangement and not in arrears.

There are, however, 120,754 mortgages in arrears and 68 per cent of those are behind by more than 90 days.

The vast majority of these, 75.3 per cent, have come to no agreement with the banks about how to get the mortgage back on track.

Of those that have been restructured, lengthening the term of a mortgage is the most frequent form of restructuring with interest only arrangements the next most popular method in 22 per cent of cases.

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Engagement between consumers and lenders has resulted in 41,236 permanent mortgage restructures according to the figures.

Recent interactions between lenders and politicians have exposed differences over what exactly constituted sustainable arrangements.

The figures come as a result of the department requesting data on the restructure situation in the six banks which together make up 90 per cent of the market.

They will from now on be released each month according to a statement from the department, “Given the importance of this issue and the demand for high quality and timely data on mortgage arrears, the Department of Finance has decided to publish this data each month.”

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Rónán Duffy

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