The legal profession has been described as the real winner in the raging mortgage crisis, which experts predict is only going to get worse.
AIB and its subsidiary EBS spent over €2m on legal fees relating to repossession cases since the start of 2009. AIB revealed recently it has repossessed just 17 owner-occupied homes and 21 buy-to-let homes.
The sums paid to lawyers by Bank of Ireland in such cases has more than trebled since 2009, from €67,000 to €206,000 this year.
The taxpayer-backed Irish Bank Resolution Corporation — which replaced Anglo — has paid €4m to lawyers in such cases, mainly taking homes for which the wound-down Irish Nationwide had given loans.
Figures provided by the Department of Finance show €6,948,777 was spent on legal fees since 2009 in repossession cases by banks covered by the state guarantee including:
* €4,183,050 by Anglo/ Irish Nationwide;
* €2,093,727 by AIB/ EBS;
* €535,000 by Bank of Ireland;
* €137,000 by Irish Life and Permanent.
Sinn Féin’s Pearse Doherty, who obtained the figures in a written reply to a Dáil question, said the figures were “alarming” and that “the only winner here is the legal profession”.
He said while some of the cases taken by Anglo might be in relation to developers’ homes that were part of larger loans, the likelihood is that most cases are against “people who have fallen on hard times”.
Separate figures from the department show the covered institutions own 807 residential properties, including 272 which were repossessed and 323 which were voluntarily surrendered.
New Beginning, which opposes lenders repossessing homes in cases of excessive debts, said this figure was not surprising and was only going to increase, with figures showing 100,000 home mortgages were in distress.
Ross Maguire, a barrister who established the group, said the banks’ legal costs — usually over €20,000 per case — are passed on to the person whose home has been repossessed.
A total of 76 homes have been repossessed over the past two months and 1,043 in the last two years by all lenders, including those not supported by the state.