Darren O'Rourke (Meath East, Sinn Fein)
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343. To ask the Minister for Finance if there are plans to change the criteria in relation to deposit requirements for house purchases in order to recognise rent payments, over many years in some cases, as proof of ability to make mortgage repayments; and if he will make a statement on the matter. [62771/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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The Central Bank of Ireland, as part of its independent mandate to preserve and protect financial stability in Ireland, has statutory responsibility for the regulation of mortgage lending.

In line with this mandate, there are regulatory requirements lenders have to meet when providing mortgage credit to consumers. For example, lenders have to comply with loan-to-value and loan-to-income requirements.

Over the course of 2021 and 2022, the Central Bank of Ireland reviewed the lending measures to ensure they remained fit for purpose. The Central Bank of Ireland indicated that challenges facing prospective home buyers in saving for a deposit while making rental payments was one of the strongest themes coming out of the public and stakeholder engagement during the review.

One key change resulting from the review was the recalibration of the loan-to-income limit for first time buyers from 3.5 to 4 times gross income. The maximum loan-to-value limit for a mortgage is 90% of the value of the principal dwelling house.

It should be noted that lenders have the flexibility to provide up to 15% of their overall mortgage lending in a year in excess of the stated thresholds.

The Central Bank of Ireland has indicated that the requirement of a borrower deposit in the mortgage lending rules requirements is a crucial element of sustainable lending standards as it provides a buffer against the risk of negative equity arising if there is a decline in house prices.

The European Union (Consumer Mortgage Credit Agreements) Regulations 2016 also requires lenders to assess the creditworthiness of the borrower. The regulations provide that mortgage credit should only be made available where the result of the creditworthiness assessment indicates that the consumer’s obligations are likely to be met.

Subject to complying with these requirements, it remains the responsibility of each lender to determine its lending policies.

In the case of an application for a mortgage, this includes the assessment of the creditworthiness of the applicant and the determination of whether or not to provide a loan and the level of such a loan.