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Mortgage Defaulters Surge in Ireland..

Dublin: Vulture funds present a significant menace to individuals facing challenges with home loan repayments in Ireland, as per recent revelations from the Central Bank. In the last quarter of the previous year, 47,700 individuals experienced some form of default on their loan payments.

The Central Bank’s data indicates that a majority of these mortgage accounts are now being managed by vulture funds. These funds are imposing exorbitant interest rates on such individuals, sometimes reaching as high as eight to nine percent instead of offering a fixed rate. Over the past eighteen months, certain vulture funds have shockingly escalated mortgage rates by up to tenfold.

Accounts classified as in arrears, defined as mortgages not paid for three months, numbered 29,034 by the end of December. While some long-term defaulters have resolved their loans, a significant majority still find themselves in arrears. Disturbingly, six out of ten residential mortgage accounts in arrears are under the control of non-bank investment funds, according to the Central Bank.

Despite this alarming situation, legal action has not been pursued in most cases of mortgage delinquency, the Central Bank disclosed.

Accounts in long-term delinquency, defined as mortgages unpaid for two years or more, totaled 20,268 by the end of the previous year. In such dire circumstances, financial institutions resort to selling loans to vulture funds, leaving mortgagees with few options.

Vulture funds operate with a straightforward approach: they offer no relief or benefits to mortgage holders, instead exploiting existing systems to impose higher charges and reclaim interest, arrears, and penalties through litigation when necessary.

Meanwhile, the Irish government has not significantly restricted vulture funds and appears keen on facilitating their operations. Rather than addressing defaulting customers directly, vulture funds opt to charge exorbitant interest or acquire properties, often resulting in mortgage holders losing their homes. These practices play a significant role in maintaining high market prices in Ireland. A lack of robust government intervention perpetuates this cycle, allowing vulture funds to thrive.

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