There was a marginal decline in the number of mortgage accounts on private residences that were in arrears at the end of December, according to the Central Bank.
54,986 mortgage accounts were in some form of arrears by the end of the year, a decline of 0.8% – or 462 accounts – over the three month period from the start of October.
That represents around 7.5% of all mortgages on private residences at the end of 2020.
Just over 5% of accounts – 38,785 in total – were in arrears of more than 90 days, which was also down slightly on the previous quarter.
The proportion of mortgage accounts in arrears of over 90 days has been declining since the third quarter of 2013.
The decline continued throughout 2020, despite the impact of the pandemic – although it did level off between the end-March and end-June periods.
The banks introduced payment breaks of up to 6 months duration for individuals whose ability to pay was impacted by the pandemic.
Those availing of the pandemic payment breaks were not classed as being arrears for the duration of the term of forbearance.
The last of those formal payment breaks should be coming to an end in the coming weeks.
The banks say they are now dealing on a ‘case by case’ basis with individuals who continue to be impacted, but according to the lenders, in the vast majority of cases borrowers have returned to their pre-pandemic payment arrangements.
Nearly half in arrears over 2 years
Mortgages in arrears of over two years accounted for just over 45% of all residential accounts in arrears at the end of last year, the Central Bank figures show.
Of the total, 16% were overdue by between 2 and 5 years, 20% were in arrears of between 5 and 10 years, while 10% were in arrears greater than 10 years.
The outstanding balance on mortgage accounts in arrears of more than 90 days was €7.4 billion at end-December.
That equates to 7.5% of the total outstanding balance on all mortgage accounts on private dwellings.
The figures show that the courts granted orders for the repossession or sale of a property affecting 96 accounts over the last three months of 2020.
29 private homes were taken into possession by lenders during the quarter – down from 35 in the previous 3 month period.
The majority of those properties – 25 – were voluntarily surrendered or abandoned, with the remaining 4 repossessed on foot of a Court Order.
According to the ratings agency, Fitch, the volume of non-performing loans at Irish banks will increase in the coming quarters as support measures for borrowers during the pandemic come to an end.
This analysis includes business as well as personal lending.
However, it expects ‘asset quality deterioration’ to be much less severe than in the aftermath of the 2008 financial crisis.