The relevance of the difference between projected mortgage repayments and current rental payments for a prospective purchaser is very limited. It takes no account, for example, of the fact that while rent levels can be adjusted to reflect changing household income, mortgage repayments cannot. Nor does it take account of the additional costs taken on when a household becomes a homeowner thereby assuming responsibility for the on-going maintenance of their home.
Provisions governing mortgage lending by local authorities are set out under the Housing (Local Authority Loans) Regulations 2012 and associated credit policy. Persons in receipt of social welfare payments are not specifically precluded from purchasing their home under any tenant purchase scheme. However, if the applicants are applying to fund the purchase through loan finance from the local authority they must meet the criteria which apply to such loans.
While, as a general rule, the credit policy provides that loans are not available to those in receipt of unemployment/social welfare benefits, an exception may be made where there is a primary income of a permanent waged/salaried nature and where the secondary income is from the Department of Social Protection.
In such cases long term social welfare payments can be considered, provided the long term nature of the payment is confirmed. The final decision on whether to grant/refuse an applicant lies solely with the relevant local authority. All local authorities must satisfy themselves on the financial risk they are undertaking.
