Dáil Éireann Debate, Tuesday - 17 June 2014
456. Deputy Sean Fleming asked the Minister for the Environment, Community and Local Government if persons in receipt of disability allowance or other social protection payments will have their payments taken into account under the new tenant purchase scheme regarding their eligibility for a loan when it comes into operation; and if he will make a statement on the matter. [25655/14]
View answer470. Deputy Sean Fleming asked the Minister for the Environment, Community and Local Government the income limits and thresholds in respect of persons who wish to seek a house purchase loan from the local authorities; if these go through the housing agency; if he will provide information on same; and if he will make a statement on the matter. [25993/14]
View answer471. Deputy Sean Fleming asked the Minister for the Environment, Community and Local Government the income limits and thresholds available to persons who wish to obtain a loan via local authorities or the Housing Agency under the new tenant purchase scheme which he intends introducing; when this is expected to be in operation; and if he will make a statement on the matter. [25994/14]
View answerI propose to take Questions Nos. 456, 470 and 471 together.
The Housing (Miscellaneous Provisions) Bill 2014, for which Report and Final Stages will be taken in the Dáil today, will, among other things, underpin a new tenant purchase scheme to replace the 1995 scheme for existing local authority houses, which closed for new applications at the end of 2012. The new scheme will be broadly similar to the two incremental purchase schemes currently in operation, relating to newly-built local authority houses and local authority apartments respectively.
I expect that the Bill will be enacted by the summer, following which I will prescribe the commencement date and the detailed terms of the scheme.
There are currently two types of house purchase loan available from local authorities: standard annuity loans targeted at lower income first time buyers and loans under the Home Choice Loan scheme which are available to qualifying middle income first time buyers.
The terms and conditions governing the operation of annuity mortgages 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: http://www.environ.ie/en/Legislation/DevelopmentandHousing/Housing/.
The Regulations prescribe that the amount of a loan shall not exceed €200,000. Loans shall not be available in the case of a single borrower, where the borrower’s annual gross income is more than €50,000; or in the case of a joint application, where the combined income of the borrowers is more than €75,000.
The Housing (Local Authority Loans) Regulations 2009 provide for the issuing of written guidance in the form of a credit policy for the processing of loan applications and the making of loans by all local authorities. The credit policy, introduced with these Regulations, underpins local authority lending and ensures prudence and consistency in approach. As part of the loan application procedure, the Housing Agency provides an underwriting and support service to all local authorities. This shared central service processes loan applications, carries out credit checks and issues a recommendation to the local authority on each loan application in accordance with the credit policy. The final decision on loan approval is a matter for each local authority and its credit committee on a case-by-case basis. Accordingly, the local authority issues the loan and the Housing Agency provides an underwriting and support service to the local authority during the loan application process.
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.
