Dáil Éireann Debate, Tuesday - 17 April 2018
214. Deputy Pearse Doherty asked the Minister for Finance the policy in place at each of the State-backed banks regarding Part 9 of the European Union (Consumer Mortgage Credit Agreements) Regulations 2016, particularly with regard to the discount they apply to foreign earnings as a rule in mortgage applications; and if he will make a statement on the matter. [14963/18]
View answerOfficials in the Department of Finance have referred the Deputy's question to the banks and have received the following responses:
AIB: The Mortgage Credit Directive on FX loans states that where a customer is dependent on non-euro income or assets to repay their mortgage, if the rate of exchange deviates by more than 20% from the exchange rate at the time the customer applied for their mortgage, the bank is required to write to that customer advising them of the implications to their repayment capacity.
In line with the above if an applicant derives part or all of their income from a non-euro currency and is dependent on that income to repay their mortgage, AIB stresses the exchange rate applied to their gross income by a 20% factor on the current exchange rate to mitigate against currency risk.
PTSB: Permanent TSB’s residential mortgage lending policy outlines that income denominated in a currency other than Euro is not considered as part of the affordability assessment for new mortgage advances. The Bank’s policy limits any currency exchange rate risk on the consumer and is aligned with Consumer Mortgage Credit Agreements Regulations 2016.
