Dáil Éireann Debate, Thursday - 27 September 2018
267. Deputy Bernard J. Durkan asked the Minister for Housing, Planning and Local Government the number of persons who have made an application for Rebuilding Ireland loans; the number granted, refused and pending, respectively; and if he will make a statement on the matter. [39330/18]
View answer268. Deputy Bernard J. Durkan asked the Minister for Housing, Planning and Local Government if and when responsibility for processing local authority housing loans will be given to each individual local authority with a view to shortening the process period; and if he will make a statement on the matter. [39331/18]
View answer269. Deputy Bernard J. Durkan asked the Minister for Housing, Planning and Local Government the reason most commonly given for refusal of Rebuilding Ireland loans to young couples; and if he will make a statement on the matter. [39332/18]
View answerI propose to take Questions Nos. 267 to 269, inclusive, together.
As with the previous local authority home loan offerings, loan applications under the Rebuilding Ireland Home Loan are made directly to the local authority in whose area the property proposed for purchase is situated. My Department does not directly collect information on the number of loan applications received by each local authority.
However, as is currently the case, my Department will continue to publish information on the overall number and value of (i) local authority loan approvals and (ii) local authority loan drawdowns. Information up to Q4 2017 is available on the Department's website at the following link:
http://www.housing.gov.ie/housing/statistics/house-prices-loans-and-profile-borrowers/local-authority-loan-activity, and this information will be updated on a quarterly basis as additional data is compiled.
In addition, the Housing Agency provides a central support service which assesses loan applications that are made to the local authorities and makes recommendations to the authorities as to whether loans should be offered to applicants. I have asked the Agency to centrally compile figures on the numbers of applications that it has assessed and the most recent figures, as at the end of August, indicate that the Agency had received a total of 2,628 applications for assessment from local authorities. Of the 2,628 applications received, 2,074 were deemed to be valid. Of these valid applications, 1,989 had been assessed and 1,024 of these (51%) had been recommended for approval.
As has been the case since the introduction of the Rebuilding Ireland Home Loan, applications are made directly to the local authority in which the applicant wishes to purchase a property. Applications are then processed by the local authority before being sent to the Housing Agency for assessment. Based on this comprehensive financial analysis, the Housing Agency makes a recommendation to the local authority on each application.
Each local authority must have in place a credit committee which makes the final decision on applications for loans, in accordance with the statutory credit policy issued in accordance with the Regulations and having regard to the recommendations made by the Housing Agency.
The purpose of the scheme is to enable credit-worthy first-time buyers to access sustainable mortgage lending to purchase new or second-hand properties in a suitable price range, where they have been unable to obtain sufficient mortgage finance from a commercial lender. However, in accordance with the statutory credit policy, as with any other loan, potential borrowers must be credit-worthy and must demonstrate that they have the ability to repay the loan. It would be irresponsible to give individuals approval for loans that may see them placed under undue financial strain. The creditworthiness checks that are part of the approvals process for the Rebuilding Ireland Home Loan, and which may result in individuals being refused, help to safeguard against this eventuality and assist in protecting both the applicant and the Exchequer.
Of the 1,989 applications underwritten to the end of August 2018, 49% were not recommended for approval. Reasons for applications not being reconsidered under the scheme include an inability to satisfactorily demonstrate sufficient repayment capacity for the loan, or having an unsatisfactory savings record.
