Residential Mortgage Arrears, Restructures and Repossessions

[polaris]

@Dubhgeannain

@Moss

By the way they gave him a timeline of September for the repossession

Plenty of time to gut the place so.

Probably be some “grassroots” organisation protesting and taking pictures when it gets auctioned.

[TheJackal]

@Open Window

@bugler

Q4 2012 figures out tomorrow, but will show an increase in 90 days + arrears from 86,000 to 90,000

independent.ie/business/pers … l#comments

I wonder what the OO Vs BTL breakdown would be, similar ratio is it something like l 3:1 or 4:1? (OW does not

I’ll keep an eye out for these figures today and do my usual analysis for both OO and BTL

Link is here but not live yet
centralbank.ie/polstats/stat … istics.pdf

[bugler]

Stats up now.

[qwerty]

By Joe Brennan
March 7 (Bloomberg) – Irish banks’ cases of 90+ days plus owner-occupier mortgage arrears rose to 11.9% at end-Dec. vs 11.5% end-Sept.

• Buy-to-let arrears rose to 18.9% vs 17.9% on quarter,
  Dublin-based central bank says in statement
• Irish banks’ had restructured 79,852 owner-occuper mortgages
  end-Dec
  • 37.2% of restructured loans on interest only, 21.6% on
    reduced payments greater than interest only, 16.8% on
    term extensions
• Banks had restructured 21,800 BTL loans at end-Dec.
• Irish banks had 792,096 owner-occupier loan accounts, valued
  at EU110.8b at end-Dec
• No. of early-case owner-occupier arrears fell in 4Q
• Lenders had 903 repossessed owner-occupier homes end-Dec. vs
  947 start-Q4

NOTE: Bank of Ireland CEO Doesn’t Fear Says Tests as Arrears Stabilize {NSN MJ5BV90YHQ0X }

[TheJackal]

Residential Mortgage Arrears, Restructures and Repossessions Q4 2012 figures are out today
(note: analysis below includes a lot of restated Q3 figures)

centralbank.ie/polstats/stat … istics.pdf

Outstanding:
Total residential mortgage loan accounts outstanding - at end of Q4 2012 792,096 (Q3 2012 794,375)

Arrears:
Total mortgage arrears cases outstanding - at end of Q4 2012 which are:

• In arrears up to 90 days 49,393 (Q3 2012 50,031)
• In arrears 91 to 180 days 19,073 (Q3 2012 19,814)
• In arrears over 180 days 75,415 (Q3 2012 71,544)
  of which
• In arrears 181 to 360 days 24,063 (Q3 2012 24,469)
• In arrears 261 to 720 days 27,829 (Q3 2012 26,453)
• In arrears over 720 days 23,523 (Q3 2012 20,622)

Total arrears cases over 90 days outstanding 94,488 (Q3 2012 91,358)
% of loan accounts in arrears for more than 90 days 11.9% (Q3 2012 11.5%)

Repossessions:
Residential properties in possession - at end of Q4 2012 903 (Q3 2012 944)

• of which Residential properties repossessed on foot of an Order to date in 2012 194(Q1 65, Q2 44, Q3 47, Q4 38)

• of which Residential properties repossessed on foot of an Order in 2011 196 (Q1 49, Q2 54, Q3, 43 Q4 50)

• of which Residential properties voluntarily surrendered/abandoned to date in 2012 410(Q1 105, Q2 102, Q3 107, Q4 96)

• of which Residential properties voluntarily surrendered/abandoned in 2011 412
  (Q1 91, Q2 119 , Q3 119, Q4 83)

Restructured Mortgages:
Total outstanding classified as restructured - at end of Q4 2012 79,852 (Q3 2012 81,634)

• of which are not in arrears 42,031 or 52.6% (Q3 2012 43,600 or 53.4%)

So we can see:
% of arrears cases over 90 days (94,488) which is 11.9% of all residential mortgages outstanding, has resulted in repossessions of just 604 in the 12 months from Q1 2012 and Q4 2012 = 0.76%

And 2/3 of these were voluntarily surrendered.

Residential properties repossessed on foot of an Order between Q1 2012 and Q4 2012 was 194 or just 0.24%, meaning
just 1 in 400 residential mortgages in arrears over 90 days are repossessed by court order.

[Dubhgeannain]

• of which Residential properties repossessed on foot of an Order to date in 2012 194(Q1 65, Q2 44, Q3 47, Q4 38)

• of which Residential properties repossessed on foot of an Order in 2011 196 (Q1 49, Q2 54, Q3, 43 Q4 50)

• of which Residential properties voluntarily surrendered/abandoned to date in 2012 410(Q1 105, Q2 102, Q3 107, Q4 96)

• of which Residential properties voluntarily surrendered/abandoned in 2011 412

So if i’m reading right that’s a fall in the number of houses repossessed and surrendered in the year (fell by 2 each)? But arrears continues to mount

Maybe that should be in the signs of the impending recovery thread.

[Larry]

@TheJackal

Total mortgage arrears cases outstanding - at end of Q4 2012 which are:

• In arrears up to 90 days 49,393 (Q3 2012 50,031)
• In arrears 91 to 180 days 19,073 (Q3 2012 19,814)
• In arrears over 180 days 75,415 (Q3 2012 71,544)

@qwerty

• Irish banks’ had restructured 79,852 owner-occuper mortgages
  end-Dec

Is there overlap between these two? Or does “arrears” mean “arrears not restructured”?

[TheJackal]

@Dubhgeannain

• of which Residential properties repossessed on foot of an Order to date in 2012 194(Q1 65, Q2 44, Q3 47, Q4 38)

• of which Residential properties repossessed on foot of an Order in 2011 196 (Q1 49, Q2 54, Q3, 43 Q4 50)

• of which Residential properties voluntarily surrendered/abandoned to date in 2012 410(Q1 105, Q2 102, Q3 107, Q4 96)

• of which Residential properties voluntarily surrendered/abandoned in 2011 412

So if i’m reading right that’s a fall in the number of houses repossessed and surrendered in the year (fell by 2 each)? But arrears continues to mount

Maybe that should be in the signs of the impending recovery thread.

It’s mad alright.

Repossession figures were stagnant in 2012. This despite going from 9.2% of arrears cases over 90 days (70,911) in Jan to 11.9% (94,488) in Dec 2012.

[TheJackal]

@Larry

@TheJackal

Total mortgage arrears cases outstanding - at end of Q4 2012 which are:

• In arrears up to 90 days 49,393 (Q3 2012 50,031)
• In arrears 91 to 180 days 19,073 (Q3 2012 19,814)
• In arrears over 180 days 75,415 (Q3 2012 71,544)

@qwerty

• Irish banks’ had restructured 79,852 owner-occuper mortgages
  end-Dec

Is there overlap between these two? Or does “arrears” mean “arrears not restructured”?

There will be an overlap for those restructures and in arrears. If you go off the figures, there’s a 37,821 overlap. We do not know how long they are in arrears for.

(79,852 restructured less 42,031 restructured but not in arrears)

[TheJackal]

Two sides of the reporting spectrum

Glass half full by IT - Pace of mortgage arrears slows
irishtimes.com/newspaper/bre … ing39.html

Glass half empty by Indo - Mortgage arrear figures climb again with more than 186,000 accounts behind
independent.ie/business/pers … 15897.html

Love the bit where Indo says

However, the Irish Banking Federation was quick to issue a statement pointing out that there has been a decline in the numbers getting into early-stage arrears.

Eh no… Figures clearly state under 90 days arrears went from 141K to 143K! Do IBF just make up replies or what?

And then IT totally lose the plot

Mortgage arrears rose in the fourth quarter at the slowest pace in three years, new figures from the Central Bank showed.

The data also showed home loans that were less than 90 days in arrears fell by more than 1 per cent, giving rise to **fresh optimism **that the situation may be easing…

The figures also showed that the number of loans who are in arrears of more than 720 days rose by 14.1 per cent compared to the third quarter of the year, with more than 23,500 mortgages falling into this category.

So higher arrears but at a slower pace means optimism apparently. Yet, a sentence later they say arrears over 720 days (2 whole years) rose a whopping 14.1% to 23,500. That money (4.75bn) ain’t ever coming back

[marcexec]

@qwerty

By Joe Brennan
…]

• Buy-to-let arrears rose to 18.9% vs 17.9% on quarter,
  Dublin-based central bank says in statement
• Irish banks’ had restructured 79,852 owner-occuper mortgages
  end-Dec
  • 37.2% of restructured loans on interest only, 21.6% on
    reduced payments greater than interest only, 16.8% on
    term extensions
• Banks had restructured 21,800 BTL loans at end-Dec.
  …]

Can someone explain why the number only adds up to 75.6%?
What happend to the rest? Business as usual (not paying at all) or queued for reposssion?

[Dubhgeannain]

@TheJackal

Love the bit where Indo says

However, the Irish Banking Federation was quick to issue a statement pointing out that there has been a decline in the numbers getting into early-stage arrears.

Talk about not see the wood for the trees. Their key word is “early stage arrears” (read less than 90 days) i.e. it’s fallen from 50,031 to 49,363.

Basically the total number of arrears has increased but it’s okay there’s less in 90 days arrears but more in >180 days. But we don’t really care about long term arrears. Unbelievable

[Dubhgeannain]

@marcexec

@qwerty

By Joe Brennan
…]

• Buy-to-let arrears rose to 18.9% vs 17.9% on quarter,
  Dublin-based central bank says in statement
• Irish banks’ had restructured 79,852 owner-occuper mortgages
  end-Dec
  • 37.2% of restructured loans on interest only, 21.6% on
    reduced payments greater than interest only, 16.8% on
    term extensions
• Banks had restructured 21,800 BTL loans at end-Dec.
  …]

Can someone explain why the number only adds up to 75.6%?
What happend to the rest? Business as usual (not paying at all) or queued for reposssion?

Pie chart from the report. I’ve snipped it for you

And since I had to check myself: “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.” Sounds like resetting the clock to me. I think this alone probably warrants further discussion and could be where the write-offs are disguised.

[marcexec]

@Dubhgeannain

And since I had to check myself: “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.” Sounds like resetting the clock to me. I think this alone probably warrants further discussion and could be where the write-offs are disguised.

Thanks for that. I agree, that sounds kind of dubious…

[Dubhgeannain]

RTE’s take:

rte.ie/news/business/2013/03 … n-arrears/

Meanwhile, the Secretary General of the Department of Finance, John Moran, has told the Public Accounts Committee there is an “unnaturally low level of repossessions” of houses in Ireland.

He said the forbearance measures by the banks that resulted in this low rate of repossessions were necessary until a range of measures - notably the personal insolvency legislation - were in place to address the arrears situation.
Pressed by Deputy Shane Ross on whether he expected an upsurge in repossessions, Mr Moran noted the repossession rate in Ireland was 0.25% compared with 3% in the UK.

[Eschatologist]

@Dubhgeannain

And since I had to check myself: “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.” Sounds like resetting the clock to me. I think this alone probably warrants further discussion and could be where the write-offs are disguised.

If the principal is increased by the accumulated unpaid interest then it’s not a write off.

debtquestions.co.uk/prob_mortgagearrears.php
“Capitalisation means that the arrears are added to the outstanding balance of the mortgage and a new monthly repayment is calculated. You then pay the new monthly payment for the remaining term.”

If the term stays the same and there is a long period of arrears then the repayments will increase, substantially. Not sure how that’s going to help someone who couldn’t pay the smaller amount.

[Dubhgeannain]

@Eschatologist

@Dubhgeannain

And since I had to check myself: “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.” Sounds like resetting the clock to me. I think this alone probably warrants further discussion and could be where the write-offs are disguised.

If the principal is increased by the accumulated unpaid interest then it’s not a write off.

debtquestions.co.uk/prob_mortgagearrears.php
“Capitalisation means that the arrears are added to the outstanding balance of the mortgage and a new monthly repayment is calculated. You then pay the new monthly payment for the remaining term.”

If the term stays the same and there is a long period of arrears then the repayments will increase, substantially. Not sure how that’s going to help someone who couldn’t pay the smaller amount.

Yes. But it states “some or all of the outstanding arrears are added to remaining principal balance”. So if some is added to the principal then what happens to the rest? In some case they may simply reduce the arrears and give the mortgage holder a chance to work out of it. But I expect if they’re restructuring this way they’d prefer to eliminate the arrears. Hence “some” is written off. You know it is happening on the qt?

[Eschatologist]

@Dubhgeannain

Yes. But it states “some or all of the outstanding arrears are added to remaining principal balance”. So if some is added to the principal then what happens to the rest? In some case they may simply reduce the arrears and give the mortgage holder a chance to work out of it. But I expect if they’re restructuring this way they’d prefer to eliminate the arrears. Hence “some” is written off. You know it is happening on the qt?

Ah, right. I missed the “some or” bit.

According to Coffey “The banks set aside €16 billion in the last capitalisation round to cover bank loans in the residential market”.

I guess one way or another that’s going to have to trickle down to actual mortgage holders.

[Open_Window]

@Dubhgeannain

RTE’s take:

rte.ie/news/business/2013/03 … n-arrears/

Meanwhile, the Secretary General of the Department of Finance, John Moran, has told the Public Accounts Committee there is an “unnaturally low level of repossessions” of houses in Ireland.

He said the forbearance measures by the banks that resulted in this low rate of repossessions were necessary until a range of measures - notably the personal insolvency legislation - were in place to address the arrears situation.

Pressed by Deputy Shane Ross on whether he expected an upsurge in repossessions, Mr Moran noted the repossession rate in Ireland was 0.25% compared with 3% in the UK.

No he’s right it’s not unnaturally low it’s more supernatural, quite like ghosts you very rarely see one if ever in your life time.

[TheJackal]

@Open Window

@Dubhgeannain

RTE’s take:

rte.ie/news/business/2013/03 … n-arrears/

Meanwhile, the Secretary General of the Department of Finance, John Moran, has told the Public Accounts Committee there is an “unnaturally low level of repossessions” of houses in Ireland.

He said the forbearance measures by the banks that resulted in this low rate of repossessions were necessary until a range of measures - notably the personal insolvency legislation - were in place to address the arrears situation.

Pressed by Deputy Shane Ross on whether he expected an upsurge in repossessions, Mr Moran noted the repossession rate in Ireland was 0.25% compared with 3% in the UK.

No he’s right it’s not unnaturally low it’s more supernatural, quite like ghosts you very rarely see one if ever in your life time.

According to NWL’s analysis, you are 27 times more likely to have your home repossessed in the UK than in Ireland, if you fall into arrears.

namawinelake.wordpress.com/2013/ … tatistics/