Bernard Durkan (Kildare North, Fine Gael)
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163. To ask the Minister for Housing, Planning, Community and Local Government when a local authority loan scheme can be put in place to facilitate first-time buyers or those on local authority housing lists; and if he will make a statement on the matter. [17346/17]

Bernard Durkan (Kildare North, Fine Gael)
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165. To ask the Minister for Housing, Planning, Community and Local Government when the criteria for qualification for local authority loans can be re-examined with a view to ensuring that families have an opportunity of providing themselves with their own home through the local authority scheme by reference to a realistic access criteria; and if he will make a statement on the matter. [17348/17]

Simon Coveney (Cork South Central, Fine Gael)
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I propose to take Questions Nos. 163 and 165 together.

As stated in the reply to Question No. 117 of 19 January 2017, there are already currently two local authority house purchase loan offerings available to lower income first-time buyers from local authorities.

The first is the standard annuity mortgage available from all local authorities. A first-time buyer unable to get a loan from a building society or a bank, may be eligible for a mortgage from the local authority concerned to purchase a new or second hand property or build their own home. The loan can be up to 97% of the price of the house subject to a maximum loan of €200,000. A local authority mortgage is an annuity mortgage with variable interest rates, so repayments will go up and down in line with interest rate changes. The relevant terms and conditions applying to local authority housing loans are set out in the Housing (Local Authority Loans) Regulations 2012.

Key eligibility criteria provide that a loan applicant must be a first-time buyer and must be able to show their local authority that they cannot get a loan from a bank or building society. Also, the gross income (before tax) of a single-income household in the previous year must be €50,000 or less and the combined gross income (before tax) of a two-income household in the previous year must be €75,000 or less. Prospective applicants should contact their relevant local authority for further information.

The second option is the Home Choice Loan, which is available for first-time buyers to purchase a new or second-hand property or build their own home and will be of interest to those earning above the income limits for the standard annuity loan. The relevant terms and conditions applying to the Home Choice Loan are set out in the Housing (Home Choice Loan) Regulations 2009. Home Choice provides a loan of up to 92% of the market value of a property purchased, subject to a maximum loan amount of €285,000. The loan is a normal capital and interest bearing mortgage which is repaid on a monthly basis. Home Choice Loan offers one variable interest rate. The rate is currently set at 3.25% variable, APR 3.3%. Further information is available at.

To support local authorities in operating their housing loan schemes in a consistent and efficient manner, the Housing Agency provides a central underwriting service to local authorities. The final decision on loan approval is a matter for the relevant local authority and its credit committee on a case-by-case basis and in accordance with the relevant statutory Credit Policy that underpins the scheme to ensure prudent lending.

The Credit Policy that underpins both house purchase loan schemes was introduced in 2009 and adherence to the requirements of the Credit Policy since then has ensured that the risk of borrowers defaulting on mortgages has been reduced. It is imperative that local authority lending is sustainable and protects prospective borrowers from drawing down unsustainable mortgages.