A snapshot of the long-term misery that is fuelling the mortgage crisis has been revealed.
In terms of money, there are €100bn worth of home loans on the books of the country’s banks. Now, one in every five has been in arrears for more than three months.
Four years ago, there were €113bn worth of home loans on the banks’ books, with only one in 22 in arrears for more than three months.
Today, one third of people who are behind by more than 90 days have not made a repayment in two years. That is a two-year-old, €6bn hole that has grown by €2bn since this time last year.
The growth in that critical figure, especially as a proportion of the banks’ overall balance sheets, is the cruel reality of what is vaguely called “the mortgage crisis”.
A study by the Central Bank has shown an overwhelming number of people who are behind on their mortgages are in arrears for more than six months.
Right now, almost two thirds of owner-occupier mortgage holders who have crossed the 90-day threshold have been behind on their payments for more than a year.
This long-term problem is getting worse. The number of people in that situation for more than a year has risen by 25% since Sept 2012. And it is an issue that is not simply characterised by the number of people involved.
The sums of money underpinning these figures has created a huge contingency headache for the banks.
At the end of June, €18.6bn worth of mortgages on people’s principal private residences were in arrears by more than 90 days. That figure has quadrupled since 2009.
“The acceleration of mortgage arrears in Ireland has been dramatic, even if one accounts for the severe recession,” according to Central Bank analysts.
The Central Bank research tells us that €15.6bn worth of that amount is linked to accounts that are at least six months behind on their repayments.
Those potential losses alone are now more than half the amount the State agreed to drawn down as part of the promissory note originally designed to cover the losses in Anglo Irish Bank and the Irish Nationwide Building Society.
This figure, for long-term arrears, has grown at a phenomenal pace since the crisis began to take hold in 2009.
That year, 2.7% of home mortgages, as opposed to investment loans, were in arrears by more than 180 days. That same grouping now account for 14.3% of all principal private residential mortgages.
Mortgages are being restructured but the Central Bank has noticed that the rate of arrangements has remained fairly static despite the rapid growth in the amount of people requiring such deals.
In the second quarter of this year, that growth quickened. This coincided with the imminent introduction of the personal insolvency regime.
During that period, from March to June, 23,500 principal private residential mortgages were restructured and, of those, 5,000 were already working on previous deals with the banks.
In terms of restructuring, the majority of deals led only to a little more breathing space, rather than finding long-term solutions.
One quarter of new restructuring deals left people on interest-only terms and another 28% were turned into interest-only deals with a reduced amount due on the principal.
For most people, the restructuring arrangements are working for the moment. The banks reported that three quarters of compromised plans were being serviced properly.
However, there is striking evidence of what the Central Bank called “redefaults”. This is where people cannot meet the terms of their restructured mortgages.
More than a half of all people whose arrears was built into their mortgage and a new repayment plan arranged ended up defaulting again.
And even with the misery that is falling on owner-occupiers, there is a second category of mortgages that is in even a worst state.
These are the people who are struggling to keep up with installments on investment properties they have been renting out.
Figures for this sector are not as detailed but those that are available show that the problems are much more pronounced. One quarter of all buy-to-let mortgages are behind by more than six months.
Percentage of mortgages in arrears for more than 180 days.
* June 2009: 2.7%
* June 2010: 4.1%
* June 2011: 6.9%
* June 2012: 11.1%
* June 2013: 14.3%
Percentage of all mortgages in arrears:
* Mid 2009: 4%
* Mid 2010: 6%
* Mid 2011: 10%
* Mid 2012: 14%
* Mid 2013: 16%
Value of mortgages in arrears for more than two years:
* Autumn 2012: €4.1bn
* Winter 2012: €4.7bn
* Spring 2013: €5.3bn
* Summer 2013: €6bn
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