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Home Loan Scheme

Dáil Éireann Debate, Tuesday - 8 May 2018

Tuesday, 8 May 2018

Ceisteanna (467, 468, 473)

Michael McGrath

Ceist:

467. Deputy Michael McGrath asked the Minister for Housing, Planning and Local Government if it is a condition that borrowers must have accumulated a deposit of 3% by way of savings as part of the Rebuilding Ireland home loan scheme; if a record of paying rent is taken into account in this regard; and if he will make a statement on the matter. [19686/18]

Amharc ar fhreagra

Michael McGrath

Ceist:

468. Deputy Michael McGrath asked the Minister for Housing, Planning and Local Government if the 10% deposit requirement can be met by a combination of the help-to-buy scheme and a gift from parents or another family member as part of the Rebuilding Ireland home loan scheme provided all other scheme conditions are satisfied; and if he will make a statement on the matter. [19687/18]

Amharc ar fhreagra

Brendan Smith

Ceist:

473. Deputy Brendan Smith asked the Minister for Housing, Planning and Local Government his plans to reduce the 10% requirement for the new local authority house loan in view of the difficulties facing potential applicants that have been paying high rents and find it difficult to accumulate the required deposit; and if he will make a statement on the matter. [19873/18]

Amharc ar fhreagra

Freagraí scríofa

I propose to take Questions Nos. 467, 468 and 473 together.

The new Rebuilding Ireland Home Loan Scheme is designed to enable credit worthy 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.

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.  

Exceptions to the above can be made where an applicant/applicants can clearly demonstrate a consistent and credible record of savings or rent payment through their bank account which at a minimum is equal to -

- In the case of a fixed rate loan, the proposed monthly loan repayment or

- In the case of a variable rate loan, the proposed stress tested monthly loan repayment.

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.

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