Dessie Ellis
Question:473 Deputy Dessie Ellis asked the Minister for the Environment, Community and Local Government his plans to ensure that the interest rate cut is passed on to local authority mortgage holders. [35939/12]
View answerThursday, 19 July 2012
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Written answers
Interest rates charged to local authority borrowers are determined by the Board of the Housing Finance Agency (HFA). In determining these rates, the Board of the Agency gives careful consideration to the fluctuating relationship between the rates at which it can borrow and its lending rates. The HFA is required to operate on a break-even basis and continues to provide extremely good value to local authority customers. I am acutely conscious of the fact that a considerable number of local authority borrowers are already facing difficulties in meeting their mortgage payments. However, local authority borrowers have benefited from very significant easing of mortgage costs in recent years. The effective rate for local authority borrowers since 9 November 2011 has been 3%. This has resulted in a differential of almost 1.5% between the rate charged to local authority borrowers and the average variable rate available from private lending institutions.