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Dublin: 8 °C Tuesday 10 December, 2019

Some mortgage holders 'choosing not to pay', broker says

Karl Deeter of Irish Mortgage Brokers said some borrowers are strategically withholding payments in the hope of winning a debt deal.

Image: Gareth Chaney/Photocall Ireland

AS MANY AS one in four mortgage holders are withholding mortgage instalments they could afford to pay in the hope of winning a debt reduction from their lender, a broker has claimed.

Karl Deeter of Irish Mortgage Brokers said a significant number of borrowers were “betting on their own case” by choosing not to pay their mortgage even though they had the money.

He said estimates of the number engaging in the practice ranged from 12 to 25 per cent of those in arrears. Deeter told Newstalk Lunchtime:

A lot of the banks have said lately that they’re seeing an advancement in the level of arrears, and it’s being caused by people thinking they might get some kind of debt deal. These figures are going to come out.

He said the borrowers in question could afford to pay, but were strategically choosing not to.

People come to me for mortgage consultation, and I’m saying ‘I don’t see what your problem is’. And they’re saying, ‘Well, I don’t want to give up X.’

Deeter said his estimates were based on conversations with senior bank executives and debt collection teams.

The assertions were rejected by Ross Maguire of advocacy group New Beginning, who said it was only one side of the story.

“Look where he’s getting his figures from. They’re from banks and debt collection agencies,” he told Newstalk Breakfast. “We see it in New Beginning on a day by day basis, people are doing desperate things to pay.”

Deeter’s claims came soon after high street lender Permanent TSB reported losses of €424million for last year and revealed that it had more than tripled the amount it was putting aside to cover bad debts.

More: Permanent TSB reports losses of €424million>

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Michael Freeman

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