This is despite a loophole in the law blocking repossessions.
A new report estimates that lenders have issued legal proceedings to take properties off up to 44,000 borrowers.
These are made up of residential and buy-to-let properties, according to calculations contained in a new report by Davy Stockbrokers.
An analysis estimates that what it calls non-cooperative borrowers number between 23,700 and 43,700.
Letters threatening legal action have been sent to these borrowers.
And there are fears that large numbers of properties, particularly buy-to-lets, will be repossessed.
Ulster Bank said that up to a third of its property owners in arrears were making no payments at all. The bank said it would not hesitate to repossess in these cases.
Strong demand for family-type homes and the presence in the market of large numbers of cash buyers mean that a flood of newly repossessed properties can be absorbed.
A number of banks were also likely to keep repossessed properties on their books, take the rental income and slowly release them on the market, Mr Mac Coille wrote. Changes in the law to restore the right of lenders to repossess properties have been passed by the Houses of the Oireachtas and are expected to become law soon.
Davy reckons that arrears will keep rising this year, with large numbers of homeowners struggling to repay largely due to income decreases rather than job losses.
For large numbers of borrowers in trouble the mortgage repayments are so high they represent more than half of their income, Davy reported, citing unpublished Central Bank studies.
A separate MABS (Money Advice and Budgeting Service) report found that distressed borrowers had just €777 a month left, after paying for utilities, food and childcare. But the mortgage was around €500 a month.
Banks will have to write down up to €11.5bn of mortgage debt. Most of this will be in the form of split mortgages where part of the mortgage owed is put to one side, and in most cases will probably have to be written off at the end of the mortgage term.
But one-third of borrowers are in such a bad financial position that a debt writedown will not work. These are mainly buy-to-let investors.
Half of investor mortgages are paying interest only. Despite this, almost 30,000 out of 150,000 buy-to-let mortgages are in arrears.
Lenders from Ireland and Spain are expected to be the first institutions to be covered by new ECB-led regulatory regime. union.
Ireland’s banks are expected to be swept into the new structure in the first half of next year,�writes Business Editor David Murphy.
There will be significant advantage to Ireland when its banks are covered by the new regulatory regime.
The development would have the effect of allowing access to funds in the European Stability Mechanism.
Given that the governor of the Central Bank, Patrick Honohan has declared, he deems that both senior and junior bondholders should endure the losses of the failed banks. Perhaps the time is now opportune for the authorities to confront the Troika regarding the terms of the bailout.
To quote Honohan
“The extensive socialization of losses – initially through the September 2008 guarantee and subsequently when the troika refused to countenance burden-sharing with the unguaranteed senior bondholders – has been rightly subject to comprehensive criticism.”
Take cognisance of the fact that the Troika bullied Lenihan and Cowan into agreeing to pay the Bondholders.
The question now is whom were the troikas representing? Overall, one gets the impression that their first priority was to ensure and safeguard the interest of the Bondholders. If this is the case, it would appear the interests of the IMF, and the ECB is secondary. Whatever the case may be Ireland suffers at the hand of all three.
The fact that the Trichet letters remain unreleased would seem to reinforce this view that the contents are controversial.
The Governor of the bank on the surface seems to be speaking sense.
Will Michael Noonan have the mettle to confront the Troika over the bailout terms? Will he have the vigour to say we are going to burn the Bondholders?
Maybe the time is now opportune for the citizens of Ireland to petition the Minister to cast adrift the Bondholders.