An Taoiseach Enda Kenny described it as the biggest financial challenge facing this country when he spoke in front on President Bill Clinton at the Global Irish forum at Dublin Castle last October 2011. Since then, precious little has happened to alleviate the crisis with the publication of a bureaucratic report and talk of Departmental sub-committees set up, and of course the Personal Insolvency Bill has been delayed and is not expected to be published until June 2012 and Fianna Fail leader Micheal Martin suggests that no relief will be available under the new legislation until the end of 2012, and on this front, Fianna Fail has been to the fore with its finance spokesperson Michael McGrath tabling a substantial piece of bankruptcy legislation last year which has merely gathered dust.
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This morning the Central Bank of Ireland published its mortgage arrears and repossession figures for the three months ending 31st March, 2012. The picture painted is of a continuing deterioration in Irish mortgages with one in 12.9 mortgages in arrears for more than six months, with “six months” regarded in the industry as the point beyond which a mortgage is generally beyond salvation. The 59,437 mortgages in arrears for more than six months is 6,000 more compared with Q4,2011 and a staggering 24,000 more than a year ago. The number of accounts in arrears between 90-180 days now stands at 18,193 which is the smallest increase since records began in Q3, 2009 which is possibly the only bright spark in an otherwise disturbing picture. In total there are 764,138 mortgage accounts in the State so 77,630 – or 10.16% – are in arrears of more than 90 days. The number of accounts in arrears has risen by 25% since An Taoiseach give his commitment to President Clinton in October 2011 to do something about the crisis.
A further 38,658 accounts have been restructured and about two thirds of these are on interest only with the remainder paying less than that and in some cases, nothing. The total of accounts in arrears and restructured (and performing) is 116,288 or 15% of all mortgages.
And “crisis” it is. Although 85% of accounts are still being repaid in accordance with the original mortgage agreement, 116,288 are not and each represents a difficult story which in total has a substantial impact on confidence and spending in the economy. It is high time for action on “the greatest financial challenge facing the country”
There were 170 repossessions in Q1,2012 which is broadly in line with previous quarters. Our repossession rate is less than a quarter of that in our neighbour, the UK. And compared with the UK generally, 10.2% of our mortgages are in arrears of more than 90 days compared with 2.1% in our neighbour. Our repossession rate is 83 per annum per 100,000 mortgages in arrears compared with 353 in our neighbour.