Local Authority Loans for Home Purchase and Improvement , Tenant Purchase

If you wish to purchase a house (new or second hand) in the ordinary way or to build a house but cannot get a mortgage to meet your requirements from a building society, bank etc. you may be eligible for a loan from your local authority.

The following Qualifying Criteria applies:-

1. A first time buyer (as defined by Section 92B of the Stamp Duties Consolidation
Act, 1999(as amended)
• Who has not on any previous occasion, either individually or jointly, purchased or built on his/her own behalf a house (in Ireland or elsewhere) and
• Where the property purchased is occupied by the purchaser, or a person on his behalf, as his/her only or principal place of residence and
• Where no rent, other than rent under the rent-a-room-scheme, is derived from the property for five years after the date of the current purchase

2. Aged between 18 and 70 years

3. Earning under €50,000 as a single applicant and under €75,000 as joint applicant

4. In the case of the primary earner on the application, in continuous employment for at least two years (this can be self-employment) and the second applicant must have at least one year. Certain exceptions can be considered.

5. Inadequate funding from two lenders. As currently required, the application form should be accompanied by confirmation that applicants have sought their mortgage from two lenders (banks or building societies) and have received inadequate funding offers or refusals from each before making an application for this House Purchase Loan

Maximum House Purchase Loans

a. The maximum loan amount which may be advanced for the acquisition or construction of a house has been increased to €220,000 with effect from 27th April, 2009. The maximum loan to value (LTV) ratio is 97%. The maximum mortgage loan in each case is to be determined by the local authority in accordance with the credit policy subject to the €220,000 limit, LTV limit, and subject to the purchaser’s ability to repay.

b. The maximum loan term will be 30 years in the case of House Purchase and New House, 25 years in case of Shared Ownership 15 years in case of Improvement and 20 years in case of Tenant Purchase.

c. The rate of interest charged on House Purchase and Erection Loans, Shared Ownership and Improvement Loans is variable and includes a charge to cover Mortgage Protection.

Credit Policy

In order to minimise risk and to ensure that the processing of loan applications can be carried out on the basis of the fullest available information in relation to the financial standing and general credit-worthiness of applicants, the credit policy includes a requirement to perform a credit check for each applicant and a check of any judgements filed against the applicant(s).

Reconstruction/Home Improvement Loans

The categories of persons eligible for local authority house purchase loans are also eligible for local authority loans for the carrying out of necessary works to improve, repair or extend their existing houses. This loan is for structural works only.

The maximum improvement loans are:
• €38,000 (€50,000 on offshore islands), where the loan is secured by a mortgage on the house, and

• €15,000 where the loan is not secured.

The interest rate on these loans is the same as for house purchase loans. However, mortgage protection insurance is not provided on reconstruction/home improvement loans.

Contact Details:- Housing Department, Kerry County Council, Room 30, County Buildings, Tralee. (Tel. 066-7183811 or Fax 066-7183612 or email housing@kerrycoco.ie)

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