Sign in. It’s quick, free and it’s up to you.
An account is an optional way to support the work we do. Find out more.
DEBATES ABOUT THE housing crisis are raging on and one of the most recent saw Brendan Burgess, founder of AskAboutMoney.com, commenting that the number of legal proceedings issued by banks against customers in arrears has fallen significantly.
On this segment of RTÉ’s Seán O’Rourke on Wednesday, Burgess joined Cecilia Forrestal of Community Action Network, which had launched a new report about mortgage distress, and solicitor Julie Sadlier.
The panel referenced a number of figures, including Burgess’ claim about litigation.
The claim:
There’s no storm, there’s no tsunami – the number of legal proceedings issued has fallen by half over the last two years.
When TheJournal.ie asked Burgess for his source, he said he believes he was referring to figure from the Courts Service.
The evidence
Courts Service data allows for a two year comparison between 2015 and 2017 figures in the Circuit Court – the first port of call with arrears litigation.
In 2015, there were 5,021 actions relating to mortgage arrears launched.
At the end of last year, the total number of these actions launched was 3,055.
This means that 2017 figures were about 40% lower than those for 2015.
The litigation numbers did continue to fall in 2018 and Burgess, when he spoke to Seán O’Rourke, said “over the last two years”. So let’s look at some more recent data.
The Central Bank has published more up to date figures.
According to statistics for the first six months of 2018, legal proceedings issued to enforce the debt/security on a primary dwelling house (PDH) on 1,265 accounts.
In the first six months of this year, rent receivers were also appointed to 1,116 buy to let (BTL) accounts. However this action is not taken in the courts, so does not count towards litigation figures. Most of the cases before the courts relate to a PDH.
Now if we take 2016 figures for the same period (the first six months of that year), legal proceedings were issued to enforce the debt/security on a PDH on 3,138 accounts.
This means proceedings figures have more than halved in that time.
Who is taking the litigation?
Neither the Courts Service data nor the Central Bank figures include a breakdown by lender in the Circuit Court. But we do have some data in relation to High Court actions taken by the five main pillar banks.
In the first six months of the year, 290 mortgage holders were taken to the High Court by these banks:
The overall number of cases taken in the High Court is also falling – in 2016 it was 370 in the first six months of the year. Arrears will usually have accumulated for a significant amount of time before the matter will make it to the High Court.
Verdict
We rate this claim by Brendan Burgess as Mostly TRUE.
A verdict of Mostly TRUE means the claim is close to accurate, but is missing significant details or context. Or, the best available evidence weighs in favour of the claim.
TheJournal.ie’s FactCheck is a signatory to the International Fact-Checking Network’s Code of Principles. You can read it here. For information on how FactCheck works, what the verdicts mean, and how you can take part, check out our Reader’s Guide here. You can read about the team of editors and reporters who work on the factchecks here.
To embed this post, copy the code below on your site
If you cant pay, the banks you borrowed from have every right to take it away!
@Mark Johnson: Agreed but it can’t be that black and white. The last thing we need is more families on the streets.
@PΛÐÐY ЯOOПΣY: Which is why in a way it’s good that mortgages long in arrears (I think the last batch were an average of 7 years?) are being sold to ‘vulture funds’ now because despite the name given to them by the media the business model of those funds seeking profits of usually only 1-6%/year is to buy a group of mortgages in arrears for cents on the Euro and turn them into performing loans so they can then sell on the group for a profit a few years later.
They’ve paid much less for them that usually involves drastically cutting down the size of the loan, arrears and/or monthly payment by sometimes as much as 70% which is something that banks can’t really do themselves because by EU law they need to keep their debt level low and some people just wouldn’t pay their mortgages or loans for large periods of time in the hopes of getting significant discounts.
In the vast majority of cases the only people any of those funds will seek to evict are those that are refusing to communicate with them on a deal and usually have a history of not engaging with the bank.
@Mark Johnson: Facile ignorant rubbish. The fact is the banks created the mess through their greed, got bailed out, claimed off their own insurance policies and left families in severe disress for years. You obviously work for one of these corporate criminals.
@Mark Johnson: shhhhh. Please don’t go spouting truths.
@Shane Corry: and you too, stop highlighting the truth. This does not fit the narrative.!!
@Bat Daly:
Can you prove your comment that it’s facile and ignorant and back it up ?
And if so then the necessity to name call and accuse may not be needed.
Try debating the point !
@Mark Johnson: If you cant pay, the banks you borrowed from have every right to ‘take you to court’ and to try and get the judge to rule in their favour
shhhh Francis..Please don’t go spouting truths….
If we had non recourse loans people could get on with their lives and it could speed up the process
Burgess has proven himself to be a straight talker, no waffle, just facts and approximate figures, his predictions have hit home time and time again…
I knew before I read this article that it would return a MOSTLY TRUE/TRUE verdict.
@Vic’s Burd:Thanks for the early morning chuckle,much appreciated..
David Hall the former Fianna Fail honcho and Casino Owner is the one who predicted the tsunami of repossessions. You have to ask yourself about his motivations. So far he’s proven to be full of it.
If there are no repossessions then there will be no new banks and no competition. So anyone not on a tracker will pay for the “Won’t Pay”/Strategic Defaulters. As usual the honest person who gets up early is shafted
could the fall in the number of cases /repossessions simply be down to the fact that there are now FEWER homes to repossessed ? if say back in 2015 there were 10.000 homes in mortgage arrears of over 3 years – and 6,000 of those homes have now been repossessed ,sold to vulture funds or what ever -that only leaves 4000, homes going through the court system – so there are fewer repossession orders . could it be that this guy is simply manipulating the figures to make it look like the banks give a dam ?
Those who are no longer in arrears have been given very sweet deals by the banks…split mortgages, low rate mortgages, personal debt write offs
@Mark Johnson: Can you back up that statement?
Statistics rarely reflect what is actually happening on the ground. A few years ago the courts published the lists of the number of repossession cases coming before the circuit courts around the country. The publishing of these numbers stopped at the same time as Enda Kenny told MSM to no longer report suicide cases as suicide “to protect the families”. Coincidence? Not likely.
I don’t believe these figures for one moment.
have your say