December mortgage approvals up 29% year on year

Thursday 31 January 2013 23.37
92% of mortgage approvals in December were for property purchases
92% of mortgage approvals in December were for property purchases

A new report shows that a total of 1,446 mortgages - worth €234m - were approved by lenders here during December.

The Irish Banking Federation says this represents a volume increase of 29.6% and a value increase of 29.3% over the same month last year.

The IBF says that 92% of the mortgage approvals were for property purchase, which itself showed a year on year increase of 40%.

''As the IBF Mortgage Approvals Report is a lead indicator of future mortgage market activity, we expect this evidence of renewed activity to be reflected in the actual mortgage drawdown figures for the fourth quarter of 2012 when the IBF/PwC Mortgage Market profile is published in February,'' commented the IBF's Director of Public Affairs, Felix O'Regan.

Meanwhile, a new protocol has been agreed by Irish banks on dealing with unsecured debts owed by customers who are in financial distress.

This could see substantial amounts of credit card and personal loan debt written off for people whose financial circumstances mean that they are no longer in a position to pay it off.

Under the umbrella of the Irish Banking Federation, banks have agreed that in appropriate circumstances, with a customer's permission, they will liaise with each other.

They will agree terms so that mortgage payments will be met as far as possible or may be reduced for up to five years to enable some payment to be made towards unsecured debts.

After the five year period - if the creditor's financial position has not improved - the remaining unsecured debt will be written off.

This marks the first time lenders have actually agreed any co-ordinated approach on unsecured debt.