Noel Ahern (Dublin North West, Fianna Fail)
Link to this: Individually | In context

Question 121: To ask the Minister for Finance the position regarding the extended mortgage relief announced in Budget 2010; if it will apply to a mortgage that commenced in 2003; the options that are available to assist a first time buyer, who purchased in 2003, who is still experiencing negative equity and who has suffered pay cuts of approximately 20% in the past few years; and if measures in Budget 2010 will be extended in full or pro-rata for mortgages outlined up to 10 years. [5944/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

In Budget 2010, I announced that I would be extending mortgage interest relief up to the end of 2017 for those whose entitlement to relief was due to end in 2010 or after. I should point out that this measure does not extend to those who took out qualifying loans in 2003. While circumstances and house prices differ, it is necessary to select a cut-off point in these matters. House prices increased significantly in 2004 and thereafter.

I would accept that many people are suffering financially in the current climate. However, as the Deputy will be aware there are already a number of supports in place, such as the Code of Conduct on Mortgage Arrears, the Mortgage Interest Subsidy Scheme and the services provided by the Money Advice Budgeting Services. I have spoken about these extensively in this House over the past number of months. Since my Budget speech, I have also written to the Financial Regulator requesting that consideration be given to extending the moratorium on mortgage arrears from 6 months to 12 months for all mortgage lenders.

In the Renewed Programme for Government, the Government has committed to a review of the Code of Conduct on Mortgage Arrears and the recently agreed protocol between the Irish Bankers Federation (IBF) and the Money Advice and Budgeting Service (MABS) on debt default with a view to expanding the options available for dealing with mortgage problems. I have discussed with Cabinet colleagues the best way in which to proceed in this matter and will bring proposals to the Government.

Finally, it should be noted that loans taken out on or after 1 January 2013 will not qualify for mortgage interest relief and that mortgage interest relief will be abolished completely for the tax year 2018 and subsequent years. Full details of the changes proposed in relation to mortgage interest relief are provided in the Finance Bill 2010 published today.