'They survived the crash, but now the system is failing them again' - opinion piece

Consider a couple in their early sixties. They have €70,000 left on their mortgage as they reach the end of their term, a home worth €350,000, and a clean repayment record stretching back a decade.

By any reasonable measure, they are low-risk borrowers. Yet because their loan was once restructured during the financial crisis – or simply because of their age – they remain stuck on a variable rate above six per cent with a credit servicer that cannot offer them an alternative.

That servicer’s job, ultimately, is to enforce the terms of the original loan agreement.

This couple is not an outlier. They represent thousands of Irish homeowners, including many here in Donegal, in their fifties, sixties and seventies who have spent the past decade or more in what can only be described as mortgage purgatory.

Scale of the Problem

When Irish banks offloaded deep-arrears and restructured loans during and after the financial crisis, the vast majority ended up with non-bank, non-lending credit servicers.

According to the Central Bank of Ireland’s latest mortgage statistics as at December 2025, mortgages serviced by non-banks account for 14.8 per cent of all outstanding home loans. The demographic within that cohort skews older – and gets older each year.

Many of these borrowers have something you would think lenders love: equity. After twenty or twenty-five years of repayments, coupled with strong house-price appreciation, loan-to-value ratios well below thirty per cent are common.

But high equity has never been their problem. Their problem is a residual mortgage balance at the end of the term, and crucially, who now owns the loan.

Kicked Can Down Road

At the height of the Celtic Tiger, thousands of interest-only mortgages were issued to Irish customers, Bank of Scotland Ireland being among the last major providers. The majority of those loans are now reaching the end of their terms, are being serviced by credit servicers, and many of the borrowers are searching for options other than selling their home.

In the aftermath of the crash, many mortgages were deemed unaffordable and restructured. Rather than force people from their homes, lenders – rightly – kicked the can down the road.

Split mortgages made monthly repayments manageable, kept families housed, and allowed borrowers to benefit from future property price recovery.

Fifteen years later, we have caught up with the can. The Central Bank’s December 2025 figures show approximately 22,000 split mortgages currently held across bank and non-bank lenders. Those mortgages are approaching the end of their terms just as the borrowers approach retirement and a period of reduced income.

The question that nobody has adequately answered is: what solutions will be offered to these people?

The Real Consequences

When a mortgage term expires and a balance remains, the credit servicer is obliged to enforce the terms of the loan agreement. For borrowers, the consequences are stark. Some face being forced to sell the family home in a market where they cannot afford to buy again.

Others are borrowing from adult children who are themselves struggling with housing costs and trying to save for their own deposits. In the most difficult cases, borrowers face legal enforcement proceedings – not because they have defaulted on their payments, but simply because the term has expired and the capital balance is now due.

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For people in their sixties and seventies who have been meeting their obligations for years, the stress of this uncertainty is taking a real toll on their health and wellbeing.

These are not abstract policy problems. They are playing out in kitchens and sitting rooms across the country, in families who thought the worst was behind them.

New Lenders, Old Barriers

To be fair, the picture is not entirely bleak. In the past three years, newer lenders and an expanding network of credit unions have introduced products with extended terms, higher maximum ages, or underwriting models that take a more balanced view of affordability in later life.

At the same time, the lifetime mortgage and equity-release market has matured, with hybrid interest-only options now available that fill a gap the mainstream banks have completely abandoned.

These innovations mean that many borrowers who once had no route out of a vulture-fund mortgage may now have more than one. But innovation alone is not enough. What is missing is awareness – both among borrowers and within the advisory and regulatory ecosystem – that these options exist and that independent, market-wide advice is available.

The Advice Gap

There is a structural problem that is rarely discussed. Most borrowers trapped with credit servicers have never spoken to an independent mortgage broker.

Many assumed – or were told by their servicer – that there were no options available to them. Credit servicers are not in the business of helping borrowers leave.

There is no obligation on them to signpost customers towards alternatives, and they have no commercial incentive to do so.

At the same time, the support infrastructure that exists for distressed borrowers – services like MABS and the Abhaile scheme – was designed for people in acute crisis, not for borrowers who have been meeting their repayments for years, but who need a switching pathway.

There is a gap between crisis support and mainstream mortgage advice that nobody is filling for this cohort. These borrowers need access to advisors who can assess the full range of products available across the market, from conventional switching to lifetime mortgages, rather than being limited to whatever a single servicer or lender happens to offer.

Borrowers Deserve Better

The people caught in this system are not reckless borrowers. They are men and women who survived the worst financial crisis in the history of the State, who got back on track, and who have met their obligations for years.

Many of them lie awake at night worrying about a mortgage they have been paying for a quarter of a century. They deserve the same access to competition and refinancing as every other homeowner.

It is also worth acknowledging that “just downsize” is not always a viable answer. Selling a €350,000 home, clearing the mortgage balance, paying legal and moving costs, and finding somewhere affordable to live in the same community is simply not realistic for many.

This is especially true in rural Ireland, where the housing crisis is less visible but no less real. In areas like Donegal, the second-hand housing market is thin, rental options are scarce, and downsizing often means leaving behind the community, the GP, the parish, and the neighbours that make up a person’s entire support network.

The later-life mortgage problem is not just a Dublin story – it hits hardest in the parts of the country with the fewest alternatives.

A Call for Action

The Irish mortgage market is finally developing solutions that acknowledge life does not end at retirement. The challenge now is ensuring those solutions reach the people who need them most. That requires three things.

First, greater public awareness. Borrowers trapped with credit servicers need to know that switching options may now exist for them. Too many assume, or have been told, that there is nothing that can be done.

Second, a regulatory framework for later-life lending that recognises older borrowers with strong equity and stable income as the low-risk cohort they actually are, not the high-risk cases outdated credit policies paint them to be.

Third, access to independent, whole-of-market advice. The advice gap for this cohort is real, and it is costing people their homes, their savings, and their peace of mind. Borrowers in this situation need guidance from advisors who can navigate the full range of options available, not just what a single servicer or lender happens to offer.

Older borrowers have already paid enough, financially and emotionally.

It is time for the mortgage industry, regulators, and policymakers to pay attention.

(Pascal Curran is Director of Advice First Financial Services Ltd, a Central Bank of Ireland-regulated financial advisory and mortgage brokerage firm based in Donegal. He advises clients across mortgage, pension, protection and investment planning.)