Dáil Éireann Debate, Wednesday - 2 December 2020
64. Deputy Eoin Ó Broin asked the Minister for Housing, Local Government and Heritage if advice has been given by his Department to the Housing Agency or local authorities regarding establishing whether successful applicants for the Rebuilding Ireland home loan scheme are being required to provide proof that they are not in receipt of the employment wage subsidy scheme before being able to draw down their mortgages. [40551/20]
View answerThe Rebuilding Ireland Home Loan scheme remains open for business. All local authorities are receiving and processing RIHL applications and are incorporating increased flexibility to accommodate applicants during the COVID 19 Pandemic.
As is the case with any lender, local authorities must lend mortgages on a prudent basis, taking into account the most recent income and employment data available. This is both for the protection of the lender and the borrower, in particular to seek to ensure that borrowers are not left with unsustainable debt burdens, as a mortgage is a long-term commitment. It would not be appropriate to lend when there is an identifiable risk that the person’s income and ability to pay might not return to the level required to support the borrowing requested.
Where such persons are approved for a RIHL loan, draw down would not commence until their unsupported income post TWSS has returned to the level specified in the original application for a period of time, usually up to three months. This is line with the requirement to lend prudently.
This is not a blanket ban. Local authorities can use their judgement and knowledge of local employers to advance loans to applicants before the end of this three-month period, where appropriate. This also applies to the successor scheme the Employment Wage Subsidy Scheme (EWSS). There are further exceptions to this approach. In the case of a joint application where only one party is on TWSS or EWSS, the application can also proceed to drawdown if repayment capacity can be assured based on the other person’s income. For applicants whose post-TWSS/EWSS income is lower (e.g. due to reduced hours) than stated on their application, their application can be re-assessed to determine the most appropriate borrowing amount for them.
In addition, persons currently on the TWSS/EWSS can continue to apply for a RIHL mortgage based on their pre-TWSS/EWSS Income. This will provide clarity to applicants regarding their eligibility for the loan amount and will enable them to commence the property search.
In relation to proof required to support applications, local authorities have been advised to request confirmation from applicants as to whether their wages are currently supported by the EWSS. Furthermore, as the EWSS is operationally paid to the employer and does not neccessarily appear on employee pay slips; local authorities have also been advised to take the necessary steps to secure appropriate written confirmation from the employer on whether an applicant’s wages are supported by the EWSS and to advise applicants of this requirement.
