Tuesday, 4 February 2014

Questions (167)

Joanna Tuffy

Question:

167. Deputy Joanna Tuffy asked the Minister for Finance the position regarding banks making agreements with mortgagees; if he will provide figures in tabular form for the number of split mortgages that have been put in place to date; and if he will make a statement on the matter. [5102/14]

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Written answers (Question to Finance)

The Deputy will be aware of the Central Bank's Mortgage Arrears Resolution Targets (MART) announced last March which sets time bound and measurable targets for the main banks requiring them to systematically address their arrears book. Under this rolling process, quarterly performance targets have now been set to the end of June 2014 to require the banks to propose and put in place durable long term solutions to address individual cases of mortgage accounts in arrears of more than 90 days.

The Central Bank has indicated that all six mortgage lenders covered by the MART process have reported that they met the 20% proposed sustainable solutions target for the second quarter of 2013 and also the 30% target for the third quarter in 2013.  In particular, with respect to the third quarter 2013 target, which is the latest available data, the lenders have reported to the Central Bank they had issued proposals to 43% of mortgage accounts in arrears against the 30% target.

The new monthly mortgage restructures and arrears data published by my Department shows that some progress has been made in putting permanent mortgage restructures in place.  For example, the number of permanent restructures of primary dwelling houses (PDH) more than 90 days in arrears has risen from around 41,200 in August to around 49,300 in November 2013, an increase of almost 20%.  The data also indicates that, in respect of the MART institutions, at end November 2013, 5,814 split mortgages were put in place in respect of primary home mortgages and a further 276 in respect of buy to let mortgages (this data includes those split mortgages which are initially proposed for a short-term trial period).  Mortgage restructures data in respect of the end of December 2013 will be published on 13 February next.

Early and effective engagement between borrowers and lenders is key to resolving cases of mortgage difficulty.  Where there is effective and meaningful engagement regarding a mortgage difficulty, the data shows that an increasing number of durable long term mortgage restructures is being put in place.