Ulster Bank is to continue to take action against households that are in a position to service their mortgages but who are not currently doing so.
The bank said yesterday it had witnessed a substantial rise in the number of mortgage borrowers strategically defaulting.
It attributed the increase to a number of factors including the introduction of the mortgage code of conduct and the halting of repossessions following the discovery of a loophole by Justice Elizabeth Dunne in the 2009 Land and Conveyancing Reform Act.
Speaking during a call with investors during which the bank outlined plans to reduce its number of branches, Ulster Bank’s chief risk officer Stephen Bell said about 35% of mortgage borrowers in arrears are not currently paying anything.
He said the bank had already taken steps to work with customers to find a solution to the issue and the number of borrowers defaulting had declined sharply as a result of this.
Mr Bell warned the bank would consider further steps against those not currently servicing their mortgages, including legal action if necessary. He added that the bank’s aim was to work constructively with customers but noted that the average mortgage repayment per month is usually considerably less than the householder would pay in rent.