New research by the Central Bank shows the majority of mortgage accounts going into default of up to three months in the past year have been trackers.
The data shows 53% of mortgages entering arrears of between one and three months since the first half of 2022 were trackers. 65% were loans either currently non-performing or loans that have been non-performing in the past.
The research, contained in a Financial Stability Note No.9 Mortgage borrowers missing payments during monetary tightening (Kilgarriff, Shaikh and Gaffney) (centralbank.ie) , also finds that 83% of the loans going into default originated during the property boom years 1999-2008.
However, some 35% of loans going into default have no history of missing payments.
The percentage of private dwelling mortgage accounts in arrears of up to three months fell from between 8-9% in 2012 to between 2-4% from 2016. It reached a low point of 2.3% in 2021. It went back up as interest rates began to rise last year and had reached 3% by June of this year.
3% of mortgage accounts is approximately equal to 21,400 mortgage accounts.
The total number of private dwelling mortgage accounts in arrears in June 2023 was just under 30,000 accounts or just over 4%.
Today's publication also warns the number of mortgages entering default is expected to rise because of the lag between higher repayments and arrears and what happens when people come off lower fixed rates to higher variable rates.
