Dáil Éireann Debate, Thursday - 27 March 2014
144. Deputy Joanna Tuffy asked the Minister for the Environment, Community and Local Government the position regarding guidelines to local authorities regarding house purchase loans (details supplied); and if he will make a statement on the matter. [14622/14]
View answerThere are two types of house purchase loan available from local authorities: standard annuity loans targeted at lower income first time buyers and those under the Home Choice Loan scheme which are available to qualifying middle income first time buyers affected by the “credit crunch”. The terms and conditions governing the operation, including eligibility terms, of annuity mortgages and the Home Choice Loan are set out under various Regulations such as the Housing (Local Authority Loans) Regulations 2009, the Housing (Home Choice Loan) Regulations 2009, and most recently in the Housing (Local Authority Loans) Regulations 2012. These are available on my Department’s website: www.environ.ie.
While there is no reference in the Regulations to a lower income limit threshold for mortgage applicants, the associated credit policy provides a procedure for calculating the maximum amount of mortgage repayments permissible as a percentage of the household income. Local authorities are advised to examine each application on its own merits in determining whether an applicant is eligible for a house purchase loan. House purchase loans are not, as a general rule, available to those in receipt of unemployment/social welfare benefits. However, where there is a primary income of a permanent waged/salaried nature, and where the secondary income is from the Department of Social Protection, then long term social welfare payments can be considered, provided the long term nature of the payment is confirmed by the Department of Social Protection or other relevant Government Department. Independent confirmation is required in such circumstances.
Family Income Supplement is not considered to be a long term social welfare payment for the purposes of calculating household income in the context of assessing house purchase loan applications. It is a weekly tax-free payment available to employees with children to provide extra financial support to people on low pay. Loan applicants on low incomes are dealt with on a case-by-case basis and can be referred to the Local Authority Credit Committee for a decision.
