Thursday, 26 April 2007

Ceisteanna (207)

Seán Ryan


208 Mr. S. Ryan asked the Minister for the Environment, Heritage and Local Government if his attention has been drawn to the fact that persons accepting an affordable house from a local authority are obliged to take out cover under the local authority’s mortgage protection scheme and therefore are not allowed the freedom to acquire such cover from their own insurance company which in some cases can be at a cheaper rate; his views on whether this is anti-competitive and totally against the whole concept of affordable housing; and if he will modify the existing arrangements. [15763/07]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Minister for the Environment, Heritage and Local Government)

Where a loan for the purchase of an affordable house is sourced from a private lender, the options for mortgage protection insurance would be a matter for discussion between the borrower and the lending institution. In the case of a local authority loan, the cost of mortgage protection insurance is met by way of an additional charge to the rate of interest charged on individual loans. One of the conditions of the scheme, which is a group policy, is that it is obligatory for all local authority borrowers who meet the eligibility criteria to join. Altering this condition would have a negative impact on the scheme and increase costs for all existing borrowers.