Banks "declared war" on mortgage holders as number of households in arrears by 720 days rises agai

The number of mortgages over two years in arrears rose by 5% in the second quarter of 2014 amid warnings that through repossession, banks have "declared war" on home owners behind on their payments.

Central Bank figures for the period April through June showed the number of mortgages on principal dwelling houses (PDH) now over 720 days in arrears increased by 1,752, or 5%.

That rise belied other figures that painted a more positive picture, such as a 4.7% fall in the total number of mortgages in arrears compared with the first quarter — the fourth consecutive quarter in which the total number of properties in mortgage arrears has fallen.

However, the spectre of repossession is looming into view for many homeowners, with the bank stating: “During the second quarter of 2014, legal proceedings were issued to enforce the debt/security on a PDH mortgage in 3,274 cases.

“Court proceedings concluded in 530 cases during the quarter, and in 296 of these cases the courts granted an order for repossession or sale of the property.

“There were 1,110 properties in the banks’ possession at the beginning of the quarter. A total of 299 properties were taken into possession by lenders during the quarter.”

Elsewhere, buy-to-let mortgage accounts in arrears of over 90 days increased by 2.3% in the second quarter of the year.

Homeowners in deep arrears are continuing to struggle and David Hall of the Irish Mortgage Holders Organisation said via Twitter: “With 3,000 repossession proceedings on family homes in quarter two, banks have declared war on homeowners in mortgage arrears. Long-term mortgage arrears figures again demonstrate the complete lack of effective policy to deal with mortgage arrears.”

He later said there was “no breakdown” as to the composition of the 3,000 repossession legal actions launched in the second quarter of the year and that banks were not focussing their energies on dealing with the most problematic clients.

“They are cherry-picking the easy stuff,” he said, adding that it was “disingenuous” to focus on the 90 days arrears figures when so many households were more than two years behind on their payments.

“The most difficult cohort is being left on the shelf,” he said, claiming that householders in deep trouble needed to “take their head of out of the sand” and the Government needed to employ “joined-up thinking” to help those most in need.

Mortgage accounts in arrears of over more than 90 days also fell in the second quarter of the year, in that instance by 3%.

There was also a rise in the number of mortgages that have been restructured. The Central Bank = report states: “Some 101,973 PDH mortgage accounts were classified as restructured at end-June, reflecting a quarter-on-quarter increase of 10.3%. Of these restructured accounts, 81.2% were deemed to be meeting the terms of their current restructure arrangement.”

“The largest increases in restructures were recorded in the categories of split mortgages and arrears capitalisations.”