Tuesday, 16 November 2021
Department of Housing, Planning, and Local Government
285. To ask the Minister for Housing, Planning, and Local Government if his attention has been drawn to the fact that persons are being prevented from drawing down their rebuilding Ireland loans despite having approval due to having been on the EWSS payment during the past year. [55713/21]
Local authorities when processing Rebuilding Ireland Home Loans (RIHL) must lend mortgages on a prudent basis, taking into account the most recent income and employment data available. It would not be appropriate to lend when there is an identifiable risk that the person’s income and ability to pay might not return to the level required to support the borrowing requested. This is both for the protection of the lender and the borrower, in particular to seek to ensure that borrowers are not left with unsustainable debt burdens, given that a mortgage is a long-term commitment.
Where employment supports are in place for an applicant approved for an RIHL loan, draw down would not usually commence until their unsupported income post PUP/EWSS has returned to the level specified in the original application for a period of time, usually up to three months. However, this is not a blanket ban and local authorities can use their discretion and knowledge of local employers to advance loans to applicants before the end of this three-month period, where appropriate. This discretion was set out in Circulars 19 and 29 of 2020 and 9 of 2021.
There are further exceptions to this approach. In the case of a joint application where only one party is on PUP/EWSS, the application can also proceed to drawdown if repayment capacity can be assured based on the principal applicant’s income. For applicants whose post PUP/EWSS income is lower (e.g. due to reduced hours) than stated on their application can be re-assessed to determine the most appropriate borrowing amount for them.
In addition, persons currently on the PUP/EWSS can continue to apply for a RIHL mortgage based on their pre-PUP/EWSS Income. This will provide clarity to applicants regarding their eligibility for the loan amount and will enable them to commence the property search.