Ms Derville Rowland:

I will say a bit about some of this. I understand that increases in mortgages really affect people in the choices they have to make. Everyone is trying to run a family, buy food and get kids to school. It places a heavy burden on families. Some of the people who have experienced the highest interest rates are those who hold tracker mortgages because they are more directly experiencing the increase in interest rates that have happened over a very short period of time. With regard to some of the people who might be struggling most, it is not always about the highest interest rate number as regard those most affected, rather, it can be those who have had the biggest shock in moving from an interest rate that was quite low for many years. For people who have trackers, the interest rate may be less than those headline rates that the Deputy talked about but they are actually the ones who need the support most. Last year, many people switched either in their own lender or across the system to avail of more fixed-price mortgages. However, we still have many variable- and tracker rate mortgages in the system and they are the ones who might be experiencing it the most.

The Deputy talked about those customers in the non-bank sector, particularly non-lending. There has been focus on some of the higher rates. I think a group of customers has been identified in the region – the figures change because the interest rates are changing – of between 800 to a little more than 1,000 who might be paying very high rates. When we think about the mortgage market, we want to make sure that people have mortgages they can afford now and into the future. Things are vastly different from the crisis when there were super high loan-to-income ratios of 200%. Now they are down to 90%. This means it is a better story for people because the affordability of their mortgage is better for them.

We hope people in Ireland with a mortgage are better positioned to withstand the shock but we also want people to be able to avail of choice where they can. We think more work can be done for customers in the non-bank and non-lending sector where they could switch mortgages. We think work can be done there. Banking and Payments Federation Ireland, BPFI, has announced measures that we think will help certain groups of customers. It is an important feature that people can get access to better-priced products. That is one feature. Then, when those options are not available, we have the code of conduct on mortgage arrears. From the height of the worst of the crisis in Ireland, where in 2013 to 2015 there were 130,000 to 140,000 mortgages in restructure, those figures, with much focus and many different efforts, have come down. It is important that where people are concerned about their ability to repay their mortgage, they avail of that support.

That is what we are seeing now. Obviously, it is not a first-choice option for a family but it is really important that the option is there and it is used.

This is a big part of the focus of our work, that is, looking at alternative repayment arrangements being made available to help people with mortgages. Some of the non-bank lenders have produced a wider suite of options, such as fixed-term alternative repayment options, which help families to avoid arrears and get back on their feet. We are seeing how early engagement and intervention, temporary measures and better supports can avoid the problem getting bigger. We are vigilant around this. We published data last week that show a levelling off in the figures and a continued decline in long-term mortgage arrears. However, we are concerned about arrears. We will have to remain vigilant, as will the firms. As interest rates go up, families will come under pressure, which makes it even more important that customers reach out to the firms. It is important to understand that both the banks and the non-bank lenders have a wide suite of options. Those options are being used and they are available to customers. People are entitled to that support and it is important that they reach out and take it when they need it. It is not a panacea for the whole of these issues. We do not want to see any family having trouble paying their mortgage. However, where they are in trouble or before they get into trouble, it is important that they can avail of the support. It is one of the most developed approaches in Europe. I am not saying it is perfect but it is important that we know it works, has worked in the past and that it is there for families to avail of when they need it. It is important that they can do so and opt to do so and that we continuously seek to make it work better.