Dáil Éireann Debate, Tuesday - 26 March 2013
375. Deputy Gerry Adams asked the Minister for the Environment, Community and Local Government the exceptions that may be considered for persons seeking to apply for house purchase loans via their local authority; if mechanisms exist whereby persons may appeal local authorities' decisions to refuse an application; and if he will make a statement on the matter. [14751/13]
View answerIn advancing loans for house purchase it is of critical importance that local authorities make such funding available on the basis of sound lending criteria. My Department and individual local authorities have a responsibility to ensure that mortgage lending is prudentially based and that the capacity of a borrower fully to service a loan over the full term is realistically assessed and stress-tested. Provisions governing mortgage lending by local authorities are set out under the Housing (Local Authority Loans) Regulations 2012 and associated credit policy.
Local authorities are advised to examine each loan application on its own merits in determining whether an applicant is eligible for a house purchase loan. It is the case that the rate of refusal of applications has increased since the credit policy was introduced. However, it is also clear that the loans issued under that credit policy are more likely to be fully performing. The final decision on whether to grant/refuse an applicant lies solely with the relevant local authority, and all local authorities must satisfy themselves on the financial risk they are undertaking.
I consider that the current arrangements for mortgage lending are fair and adequately meet the needs of prospective home owners in a prudent manner.
