Dáil Éireann Debate, Tuesday - 26 April 2022
621. Deputy Alan Dillon asked the Minister for Housing, Local Government and Heritage if exemptions will be provided to persons to access a local authority loan scheme who have changed their marriage status and have undergone a legal marriage separation and have a maintenance commitment for their ex-spouse and children; and if he will make a statement on the matter. [19523/22]
View answerThe Local Authority Home Loan is a Government backed mortgage for those on modest or low incomes who cannot get sufficient funding from commercial banks to purchase or build a home. It has been available nationwide from local authorities since 4 January 2022. The loan can be used both for new and second-hand properties, or to self-build. It is the successor to the Rebuilding Ireland Home Loan.
A ‘Fresh Start’ principle applies for applications to State affordable housing and the Local Authority Home Loan, for applicants who are divorced, legally separated/separated or the relationship has ended and have no financial interest in the family home. In recognition of such instances an exemption to the First Time Buyer eligibility criteria can be applied under the Fresh Start Principle for the following category of persons to apply for the Local Authority Home Loan:
- Applicant(s) that previously purchased or built a residential property, but is legally separated or divorced and has left the property and divested themselves of their interest in the property; and
- Applicant(s) that previously purchased or built a residential property but has been divested of this through insolvency or bankruptcy proceedings, are eligible to apply. However, a separate assessment of creditworthiness will be conducted by the underwriters.
There is no prohibition on formerly married persons, who are paying maintenance, from applying for a Local Authority Home loan. However, their maintanance commitments need to be taken into account when calculating their repayment capacity and creditworthiness. Where either party to a mortgage application is separated or divorced, the following maintenance commitment details should be supplied with the application:
- The extent of maintenance being received or paid by the applicant.
- The circumstances under which the maintenance payments can cease.
The final decision regarding the Local Authority Home Loan application is made by the relevant Local Authority Credit Committee on a case by case basis.
Further details can be found on localauthorityhomeloan.ie/
