Pat Casey (Fianna Fail)

I welcome the Minister of State to the House. I had the opportunity on budget day to speak on the broader aspects of the budget. I now wish to focus on one specific aspect of this Bill, the help-to-buy scheme. I acknowledge the huge role of the scheme, which has helped over 50,000 families to own their own homes. There is also the first home scheme, which came into operation lately. I want to address two technical issues with the help-to-buy scheme. The first is the loan-to-value ratio of 70%. I raised this with the previous Ministers, Paschal Donohoe and Michael McGrath, and I was gaining traction with both but one decided to go to Europe and the other decided to go to Washington. I must acknowledge the huge role they played in stabilising our economy and providing a stable economy for everybody.

With the loan-to-value ratio, I am not talking about the deadweight. I am not talking about the people who can afford to go into the bank tomorrow morning and get a 70% loan straight away. I am talking about the people who on the margins and need both the help-to-buy scheme and the first home scheme. They cannot get a mortgage of 70% but they can get one of 65% and with another 20% from the first home scheme, they could buy. If they could access the help-to-buy scheme, they would have the deposit but because they are ruled out, they do not have the money to get the deposit. I will give an example of how clinical this is. A lovely couple had all the transactions done to buy a new house in Newtownmountkennedy. The first home scheme was in place, as was the help-to-buy scheme, and then the bank rang to say it had done a miscalculation on the mortgage and had not taken into account the couple’s car loan. Their loan-to-value ratio went down from 72% to 69.2%. They lost the help-to-buy scheme payment of €30,000, they did not have the money for the deposit and they lost the purchase of their home. Three years later, they are still living in a rental property. Another example is a single mother who was buying a duplex house in Wicklow town for €280,000. She could only get a mortgage of 65% and she was topped up with both the first home scheme and some money from her mother.