Nearly one in 25 mortgage holders 90 days in arrears

ALMOST one out of every 25 mortgage holders have fallen more than 90 days behind in monthly repayments, with many people facing serious risk of losing their family home.

The average private residential home owner now owes nearly €150,000, but solicitors for lenders are increasingly pushing for payments or repossessions of properties.

Housing groups and legal rights supporters warned of struggling home owners falling even further behind in payments with rising interest rates.

Figures published by the Financial Regulator reveal the extent to which mortgage holders are struggling in the economic downturn.

A total of 28,603 home owners – 3.6% of all mortgage holders – had fallen more than 90 days behind in their monthly repayments by the end of December, compared with 26,271 at the end of September.

These mortgage defaulters owe a total €5.33 billion, but two thirds of them are at serious risk of losing their home as they have failed to make mortgage repayments in over six months.

Some 19,185 of the number of defaulters – or 2.4% who owe banks a total €3.6bn – were more than 180 days in arrears.

The total number of homes repossessed grew by 20% over the three months to December. Lenders have repossessed almost 400 properties, with 27 repossessed by court order, 74 voluntarily surrendered or abandoned, and 35 disposed of by owners in the last quarter.

It has also emerged that more than 5,000 formal demands – letters from a bank’s solicitors seeking repayments or repossession – were outstanding at the end of the last quarter, over 12% higher than in September.

Lenders who received the legal notices owed an average of €13,620.

Court proceedings were pending on another 3,232 borrowers who had fallen €88m into arrears – an average of €27,288 each.

But only 233 court proceedings were begun in the quarter, more than 50% less than the end of September.

Legal proceedings were concluded in 375 cases during the period, which resulted in lenders due to possess 152 properties by court order, voluntary surrender or abandonment.

Overall, banks and lenders had a total 792,893 private residential mortgage loans worth €118.3bn on their books at the end of 2009.

The Irish Banking Federation said the data showed that “forbearance” by lenders was assisting distressed homeowners and that early customer-lender communication had seen a fall in court proceedings initiated.

The Irish Brokers’ Association said, in addition to borrowers facing arrears, tens of thousands of mortgage holders were renegotiating their terms, by extending payment terms or making interest-only payments.

Housing agency Respond claimed the figures on homeowners currently in arrears was only the tip of the iceberg, as those who had renegotiated their terms were not included.

Legal rights organisation FLAC said the data showed mortgage holders were increasingly falling behind in payments. A fall-off in the number of cases coming before the courts, though, suggested lenders were exercising some discretion, it said.