Calls for long-term help for those in mortgage arrears

THE Government has been urged to provide long-term solutions immediately to mortgage holders in difficulty.

Figures released by the Central Bank show that at the end of March, 86,271 borrowers were more than 90 days behind on their mortgage or had their loan refinanced, up from 79,173 at the end of last year.

Managing director of Select Finance Group, Trevor Grant, said that while we have to appreciate that banks have no prior experience of dealing with such a dire situation, a formal long-term solution needs to be identified by the Government and banks immediately.

“Most of our banks are weeks if not months behind in dealing with the needs of distressed customers and this is only adding to the anxiety of the situation. The current solutions are only agreed on a short-term basis and the problem is not going away in the short term, and neither do they alleviate the mental stress the homeowners are experiencing,” he said.

The Professional Mortgage Brokers Association (PIBA) also called on the Government to “speed up measures” to assist those in difficulty.

Director of PIBA mortgage services, Rachel Doyle, said: “While there has been much discussion around measures needed to address the difficulties people are having, we would encourage the Government to act quickly so that there is clarity on the issue and mortgage holders will know where they stand.”

The Central Bank said 6.3%, or 49,609, of mortgages were in arrears for more than 90 days at the end of March, up from 5.7% at end December. These mortgages totalled €9.6bn, with €827 million in arrears. Around 35,341 loans are in arrears for more than six months, up from 31,338 in December.

Some 62,936 accounts were categorised as restructured, although 36,662 of these were not in arrears.

Broker member of the Trusted Advisor Group, Kevin McNerney, said: “People are budgeting everything they can to meet their mortgage repayments, but with enforced pay cuts from employers, and the introduction of the universal social charge, people’s take-home pay has been severely reduced and this is now impacting on their ability to meet their repayments.

“The recent ECB interest rate increase and the certainty of future rate increases is going to tip more people into this arrears bracket and the number of mortgages in arrears will continue to grow.” He said the Government needs to work with the banks and take action to stem this problem and start helping people by coming to arrangements with them, or giving them some additional tax relief.

“These figures only highlight further the growing problem that faces so many families in Ireland right now and the Government needs to act immediately before it is too late,” he said.

The Central Bank said that at the end of March there were 782,429residential mortgage accounts held here, valued at almost €116bn.