Worse to Come for Families in Arrears

Ireland’s largest housing charity has expressed concern at the increase in the number of homeowners in arrears and facing possible repossession. According to Respond! Housing Association, it is not surprising that 32,321 families are more than 3 months in arrears and warns that the situation is going to get far worse in the future. Of real concern to the housing charity is the increase of 13% in the number of homeowners who have not been able to pay their mortgage for 6 months or more. Respond! claims that more than 21,000 families are now at a very real risk of losing their home as the 12 month repossession moratorium for them will soon come to an end.

According to Respond! spokesperson Aoife Walsh there is little surprise in today’s figures and suspects that the actual amount in difficulty is far greater than we realise.
“The release of today’s figures by the Financial Regulator only confirms what we have been hearing from homeowners; they are in a constant financial struggle and finding it more difficult with each passing month. With few employment prospects, they see no light at the end of the tunnel. These figures are only the tip of the iceberg; tens of thousands have been forced to revert to interest-only mortgages, extend the term of their mortgage or in some cases take a payment holiday. These cases are not being highlighted by our banks so in reality 70,000 homeowners could be in danger of default.“

Respond! also warns that rising interest rates is going to have a devastating effect on many homeowners who are already under immense pressure each month to repay the mortgage. Starting last summer, all the main financial institutations have increased rates in the past number of months and have indicated that more will follow before the end of the year.

The housing charity maintains that the recommendations of the Expert Group on Mortgage Arrears are now required as a matter of urgency.

“The work of the Expert Group is now more critical than ever. Respond! believes that a co-ordinated approach with a wide range of solutions is needed. There is no one anwer to this problem” added Walsh. “The stress on those struggling to keep a roof over their heads cannot be underestimated. This mortgage crisis is having more than just a financial impact. In time we will see the real effects on people’s physical and mental health and family relationships. Anecdotally we hear of more people suffering depression, increased numbers at risk of suicide and increased marriage separation rates. There will be a cost to helping families and homeowners in difficulty but the longer-term cost of failing to act may be greater” concluded Walsh.