Up to a quarter of all mortgages have either been restructured or are in arrears, the Central Bank has said.
More than 70,000 loans on homes - 9.2% of the 768,917 private residential mortgages held in the Republic of Ireland - were in arrears of more than 90 days by the end of last year.
There were also 196 residential properties repossessed in 2011, with 412 residential properties voluntarily surrendered or abandoned.
But latest figures due this week are expected to show up to 80,000 loans - some 10.5% of loans - were behind on payments in the first three months of this year.
The Central Bank said financial institutions will be expected to develop options, pilot them and roll out strategies aimed to address the mortgage arrears problem.
"Approximately 25% of all mortgage volumes have either been restructured or are in arrears - so the scale of the problem is significant," it said in its annual report for 2011.
"The bank's objective is to develop and oversee steps to help to achieve a return to financial stability in mortgage loan portfolios, while while treating customers fairly."
The Free Legal Advice Centres (FLAC) said the continued rise in households behind on mortgage payments was another red flag for government to speed its reform of inadequate debt laws.
Noeline Blackwell, FLAC director general, warned the suspected 80,000 households in deep trouble does not include people who are in arrears of less than 90 days or who have already done deals with banks and are paying less than their full mortgages.
"This government and its predecessor have been talking about sorting out personal debt for years now," said Ms Blackwell.