Seán Fleming (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

Question 497: To ask the Minister for the Environment, Heritage and Local Government the provisions in place in respect of people under the shared ownership housing scheme whose monthly repayments can not exceed 35% of their income, at the time of taking out a shared ownership loan, where a persons income declines or interest rates increase during the period of the loan such that their repayments then exceed 35% of their income; the stress testing of people's abilities to repay loans in changing circumstances that are carried out under this scheme; and if he will make a statement on the matter. [21577/07]

Batt O'Keeffe (Cork North West, Fianna Fail)
Link to this: Individually | In context

It is a matter for each local authority to administer house purchase loans having regard to housing needs, local market conditions and individual circumstances. In approving a shared ownership transaction, local authorities must consider, inter alia, the ability of applicants to make the necessary mortgage and rent payments and satisfy themselves that the borrower's income is sufficient to meet the financial commitments involved under the scheme: as a guide, outgoings should not exceed 35% of a household's net income.

Where difficulties do arise, Article 10 of the Housing Regulations 1980 (Amendment) Regulations 1996 provides that, in cases of hardship, the loan repayment period may be extended and arrears capitalised so as to make repayments more manageable for the borrower.

Seán Fleming (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

Question 498: To ask the Minister for the Environment, Heritage and Local Government the details of the changes in interest rates payable under the shared ownership housing scheme since January 2007; if people under this scheme can go on to a fixed interest rate in order that their payments will not change with the variable interest rate; and if he will make a statement on the matter. [21578/07]

Batt O'Keeffe (Cork North West, Fianna Fail)
Link to this: Individually | In context

Details of the interest rates payable under the shared ownership scheme, including mortgage protection insurance, since 1 January 2007 to the present are set out in the table below:

Under the scheme, the rate of interest is variable for the mortgage term. However, borrowers have the option of purchasing the house outright at any stage and refinancing in the private sector with a fixed or variable rate mortgage. While I am satisfied that the terms available to borrowers are satisfactory, I will keep arrangements under review in consultation with local authorities and the Housing Finance Agency.