Residential Mortgage Arrears and Repossessions Statistics: Q2 2013   

Information Release 23 August 2013

Summary

  • There were 97,874 (12.7 per cent) private residential mortgage accounts for principal dwelling houses (PDH) in arrears of over 90 days at end-June 2013, up from 95,554 accounts (12.3 per cent) at end-March 2013.
  • The number of PDH accounts in longer-term arrears over 180 days increased by 3.8 per cent during Q2 2013, while quarter-on-quarter growth in the number of accounts in arrears over 720 days was 11.3 per cent.
  • The number of PDH accounts in early arrears declined further during the second quarter of the year. The figures show that 45,018 PDH accounts were in arrears of less than 90 days at end-June, reflecting a quarter-on-quarter decline of 3.3 per cent.
  • There was a total stock of 79,357 PDH mortgage accounts classified as restructured at end-June. Of these restructured accounts, 76.5 per cent of these were deemed to be meeting the terms of their current restructure arrangement.
  • There were 30,326 (20.4 per cent) residential mortgage accounts for buy-to-let (BTL) properties in arrears of over 90 days at end-June 2013, up from 29,369 (19.7 per cent) at end-March 2013.

View information release with charts and data tables.

Residential Mortgages on Principal Dwelling Houses

Arrears

At end-June 2013, there were 770,610 private residential mortgage accounts for principal dwellings held in the Republic of Ireland, to a value of €109.1 billion. Of this total stock of accounts, 97,874, or 12.7 per cent, were in arrears of more than 90 days.[1] This compares with 95,554 accounts (12.3 per cent of total) that were in arrears of more than 90 days at end-March 2013. The outstanding balance on PDH mortgage accounts in arrears of more than 90 days was €18.6 billion at end-June, equivalent to 17 per cent of the total outstanding balance on all PDH mortgage accounts.

Early arrears and longer-term arrears continued to display divergent trends during Q2. There was a quarter-on-quarter decline of 3.3 per cent in the number of accounts in arrears of less than 90 days, which stood at 45,018 at end-June, or 5.8 per cent of the total stock. Meanwhile, the number of accounts in arrears of over 360 days increased by 5.6 per cent during Q2. At end-June 2013, 57,163 PDH accounts, or 7.4 per cent of the total stock, were in arrears of over 360 days. Just over half of these were in arrears of more than 720 days. The outstanding balance on PDH accounts in arrears over 360 days was €11.4 billion at end-June, equivalent to 10.5 per cent of the total outstanding balance on all PDH mortgage accounts.

Restructuring Arrangements

Forbearance techniques include a switch to an interest only mortgage; a reduction in the payment amount; a temporary deferral of payment; extending the term of the mortgage; and capitalising arrears amounts and related interest[2]. The figures also include a small number of modification options such as split mortgages and trade-down mortgages, which have been introduced in recent months to provide more long-term solutions for customers in difficulty.

A total stock of 79,357 PDH mortgage accounts were categorised as restructured at end-June 2013. This reflects a decrease of 0.4 per cent from the stock of restructured accounts reported at end-March 2013. Of the total stock of restructured accounts recorded at end-June, 53.3 per cent were not in arrears. Restructured accounts in arrears include accounts that were in arrears prior to restructuring where the arrears balance has not yet been eliminated, as well as accounts that are in arrears on the current restructuring arrangement. At end-June, 76.5 per cent of restructured PDH accounts were deemed to be meeting the terms of their arrangement. This means that the borrower is, at a minimum, meeting the agreed monthly repayments according to the restructure arrangement. Meeting the terms of the arrangement should not be interpreted as a measure of sustainability, as not all restructure types represent longer-term sustainable solutions.

A total of 23,554 new restructure arrangements were agreed during the second quarter of the year.[3] Interest only arrangements and reduced payment arrangements (interest plus some capital) continue to account for the majority of all restructures in place, although their share fell to 49.7 per cent of total restructures at end-June, compared to 55 per cent at end-March. A breakdown of restructured mortgages by type is presented in Figure 2. The data on arrears and restructures indicate that of the total stock of 142,892 PDH accounts that were in arrears at end-June, 37,048, or 25.9 per cent, were classified as restructured at that time.

Legal Proceedings and Repossessions

During the second quarter of 2013, legal proceedings were issued to enforce the debt/security on a PDH mortgage in 270 cases. Court proceedings concluded in 637 cases during the quarter, and in 350 of these cases the Courts granted an order for repossession or sale of the property. There were 911 properties in the banks’ possession at the beginning of the quarter. A total of 223 properties were taken into possession by lenders during the quarter, of which 63 were repossessed on foot of a Court Order, while the remaining 160 were voluntarily surrendered or abandoned. During the quarter 133 properties were disposed of. As a result, lenders were in possession of 1,001 PDH properties at end-June 2013.

Residential Mortgages on Buy-to-Let Properties

Arrears

At end-June 2013, there were 148,529 residential mortgage accounts for buy-to-let properties held in the Republic of Ireland, to a value of €30.6 billion. Of this total stock of accounts, 30,326, or 20.4 per cent, were in arrears of more than 90 days. This compares with 29,369 (19.7 per cent of total) that were in arrears of more than 90 days at end-March 2013. The outstanding balance on BTL mortgage accounts in arrears of more than 90 days was €8.7 billion at end-June, equivalent to 28.5 per cent of the total outstanding balance on all BTL mortgage accounts.

The number of accounts that were in arrears of more than 180 days was 25,587 at end-June 2013, reflecting a quarter-on-quarter increase of 3.3 per cent. This compares to an increase of 4.9 per cent recorded in Q1, relative to Q4 2012. Meanwhile, the number of accounts in arrears of over 360 days increased by 5.6 per cent during Q2 2013. At end-June 2013, 19,218 BTL accounts, or 12.9 per cent of the total stock, were in arrears of over 360 days. The outstanding balance on these accounts was €5.9 billion at end-June, equivalent to 19.2 per cent of the total outstanding balance on all BTL mortgage accounts. There was a decrease of 3.8 per cent in the number of early arrears cases during the second quarter of the year. The number of BTL mortgage accounts in arrears of less than 90 days was 9,622 at end-June, or 6.5 per cent of the total stock.

Restructuring Arrangements

A total stock of 21,563 BTL mortgage accounts were categorised as restructured at end-June 2013, reflecting an increase of 0.3 per cent from the stock of restructured accounts reported at end-March 2013. Of the total stock of restructured accounts recorded at end-June, 61.1 per cent were not in arrears, while 77.4 per cent were meeting the terms of their restructure arrangement. A total of 5,808 new restructure arrangements were agreed during the second quarter of the year. Interest only arrangements and reduced payment arrangements (interest plus some capital) continued to account for the majority of restructures in place for BTL mortgages (approximately 63 per cent). The data on arrears and restructures indicate that of the total stock of 39,948 BTL accounts that were in arrears at end-June, 8,381, or 21 per cent, were classified as restructured at that time.

Legal Proceedings and Repossessions

There were 479 BTL properties in the banks’ possession at the beginning of Q2 2013. A total of 75 properties were taken into possession by lenders during the quarter, of which 15 were repossessed on foot of a Court Order, while the remaining 60 were voluntarily surrendered or abandoned. During the quarter 52 properties were disposed of. As a result, lenders were in possession of 502 BTL properties at end-June 2013.

Annex 1: Mortgage Arrears Data and Further Information

The mortgage arrears data, along with a set of explanatory notes, are available in the Mortgage Arrears section of the Statistics portal of the Central Bank of Ireland website: http://www.centralbank.ie/polstats/stats/mortgagearrears/Pages/Data.aspx.

The Central Bank of Ireland has produced a number of consumer guides to assist consumers who are in arrears or facing arrears, including

  • Mortgage Arrears - A Consumer Guide to Dealing with your Lender;
  • Mortgage Arrears - Frequently Asked Questions; and
  • Guide to Completing a Standard Financial Statement.

The above guides, that include information on the protections that are available to consumers in financial difficulty, are available to download from the consumer information section of the Central Bank website.


 

[1] The figures published here represent the total stock of mortgage accounts in arrears of more than 90 days, as reported to the Central Bank of Ireland by mortgage lenders. They include mortgages that have been restructured and are still in arrears of more than 90 days, as well as mortgages in arrears of more than 90 days that have not been restructured.

[2] Arrears capitalisation is an arrangement whereby some or all of the outstanding arrears are added to the remaining principal balance, to be repaid over the life of the mortgage.

[3] This includes first-time restructures and further modifications of existing restructures.