Written answers

Tuesday, 26 May 2009

Department of Environment, Heritage and Local Government

Local Authority Housing

10:00 pm

Photo of Joanna TuffyJoanna Tuffy (Dublin Mid West, Labour)
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Question 382: To ask the Minister for the Environment, Heritage and Local Government if he has written to local authorities in respect of the way local authorities deal with local authority mortgagers that are having difficulties making repayments at present due to changes in their income as a result of the economic recession; if local authorities have been given instructions in relation to requests by mortgagers to pay interest only on a temporary basis; and if he will make a statement on the matter. [21517/09]

Photo of Michael FinneranMichael Finneran (Roscommon-South Leitrim, Fianna Fail)
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Local authority borrowers have benefited from very significant easing of mortgage costs in recent months. The effective rate for local authority borrowers from 1 June 2009 will be 2.25% - a cumulative rate decrease since October 2008 of 3%.

To date there is no evidence to suggest that wider economic circumstances are creating problems specifically for local authority borrowers in meeting mortgage repayments. Rates charged to local authority borrowers offer very good value by comparison to rates charged by commercial lenders; as of 1 June, the local authority rate will be 0.85% lower than the average market variable rate.

Where any borrower, either from a local authority or from a financial institution, is facing difficulties in meeting mortgage repayments, they should engage proactively and constructively with the lender to seek to achieve an agreed solution. The services of the Money Advice and Budgetary Service are also available to such borrowers and support is also available through the Supplementary Welfare Allowance Scheme.

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