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Rate rise to fuel mortgage crisis

THE NUMBER of homeowners falling into arrears in their mortgage repayments will increase when the European Central Bank raises interest rates.

Struggling mortgage holders will be forced into a tighter position with the expected rise in the base rate, according to the Irish Mortgage Corporation.

Director of the Irish Mortgage Corporation, Frank Conway (above), said many loans were structured on a so-called interest-only basis. "Many are now moving to full capital and interest repayments," he said. "This typically results in monthly repayments increasing three-fold."

According to the Central Bank, more than 44,000 homeowners are now 90 days or more behind on their mortgage repayments.

The Irish Mortgage Corporation expects to see thousands more struggling to come up with the extra funds to pay the higher costs.