Dáil Éireann Debate, Friday - 7 September 2018
1408. Deputy Brendan Smith asked the Minister for Housing, Planning and Local Government his plans to reduce the 10% deposit required to avail of a local authority housing loan; and if he will make a statement on the matter. [36763/18]
View answerThe Rebuilding Ireland Home Loan Scheme is designed to enable creditworthy first-time buyers to access sustainable mortgage lending to purchase new or second-hand properties. The low rate of fixed interest associated with the Rebuilding Ireland Home Loan provides first-time buyers with access to mortgage finance that they may not otherwise have been able to afford at a higher interest rate.
To support prudential lending and consistency of treatment for borrowers, a Loan to Value ratio of 90% applies to the Rebuilding Ireland Home Loan as per the Central Bank's prudential lending guidelines. Therefore, in order to avail of the loan, applicants must have a deposit equivalent to 10% of the market value of the property, and I have no plans to change what I believe is a financially prudent measure.
Applicants must provide bank or similar statements (such as post office, credit union etc.) for a 12-month period immediately prior to making an application, clearly showing a credible and consistent track record of savings. The cash savings should be no less than 3% of the market value of the property. Gifts are permissible up to 7% of the market value of the property, where their source is verified.
For prospective purchasers of newly-built properties, the availability, through the Revenue Commissioners, of the Help to Buy Initiative for first-time buyers may provide additional assistance to prospective applicants for the Rebuilding Ireland Home Loan.
Further information, including a Frequently Asked Questions section, is available on the Rebuilding Ireland Home Loan website at http://rebuildingirelandhomeloan.ie.
