Housing (Local Authority Loans) Regulations 2009

• Statutory Instrument No.: 145/2009
• Published date: 24 April 2009

S.I. No. 145 of 2009

HOUSING (LOCAL AUTHORITY LOANS) REGULATIONS 2009

Notice of the making of this Statutory Instrument was published in

“Iris Oifigiúil” of 24th April, 2009.

In exercise of the powers conferred on the Minister for the Environment, Heritage and Local Government by section 11 of the Housing (Miscellaneous Provisions) Act 1992 (No. 18 of 1992) (as adapted by the Environment and Local Government (Alteration of Name of Department and Title of Minister) Order 2003 ( S.I. No. 233 of 2003 )), which powers are delegated to me by the Environment, Heritage and Local Government (Delegation of Ministerial Functions) (No. 2) Order 2008 ( S.I. No. 225 of 2008 ), I, Michael Finneran, Minister of State at the Department of the Environment, Heritage and Local Government, with the consent of the Minister for Finance, hereby make the following regulations:—

Citation and commencement.

1. (1) These Regulations may be cited as the Housing (Local Authority Loans) Regulations 2009.

(2) These Regulations shall come into operation on 27 April 2009.

Interpretation.

2. (1) In these Regulations, any reference to an article which is not otherwise identified is a reference to an article of these Regulations.

(2) In these Regulations—

“the Act” means the Housing (Miscellaneous Provisions) Act 1992 ;

“the Agency” means the Housing Finance Agency;

“borrower” means a person to whom a loan is made and includes a person applying for a loan;

“credit policy” means written guidelines for housing authorities setting out the terms and conditions for making of loans under these regulations;

“first time buyer” has the meaning assigned to it under section 92B of the Stamp Duties Consolidation Act 1999 (as amended);

“the Minister” means the Minister for the Environment, Heritage and Local Government;

“value” means;

(a) in the case of an existing or a new house, the market value of the house as determined by the housing authority;

(b) in the case of a house being constructed, the amount, which in the opinion of the housing authority represents the reasonable cost (including all reasonable incidental expenses) of building the house and the value of the interest of the borrower in the site thereof;

and “valuation” shall be construed accordingly.

Application.

3. These regulations shall apply to the provision of loan finance by housing authorities to first time buyers for the acquisition of houses, or for the construction of new houses, including—

(a) the purchase of a house under section 90 of the Act of 1966;

(b) the purchase of an affordable house within the meaning of Part 2 of the Housing (Miscellaneous Provisions) Act 2002 , or Part V of the Planning and Development Acts 2000 - 2007;

(c) the grant of a shared ownership lease under section 2 of the 1992 Act.

Amount of loans.

4. The amount of a loan shall not exceed—

(a) €220,000; or

(b) 97% of the value of the house,

whichever is the lesser.

Eligibility Criteria.

5. Subject to the following provisions of this article, loans shall not be available—

(a) unless the borrower occupies the house on completion as his or her normal place of residence;

(b) in the case of a single borrower, where the borrower’s annual gross income is more than €50,000;

(c) in the case of a joint application, where the combined income of the borrowers is more than €75,000;

(d) to borrowers under the age of 18 years;

(e) to borrowers over the age of 70 years;

(f) where the property is situated outside the Republic of Ireland or has a gross internal floor area of 175 square metres or more.

Credit Policy.

6. (1) The Minister shall issue to housing authorities a credit policy which is in compliance with the provisions of article 5.

(2) The credit policy shall set out, inter alia—

(a) detailed requirements in relation to the financial standing of borrowers;

(b) proof of source of equity contribution;

(c) proportion of net monthly income of borrowers allowable to make loan repayments;

(d) employment conditions of borrowers;

(e) valuation requirements;

(f) other borrowing conditions (including insurance requirements); and,

(g) prohibited categories of borrowers.

(3) Decisions on all loan applications shall be made by housing authorities in accordance with the credit policy.

Repayment period.

7. Unless otherwise agreed by the housing authority, a loan shall be repaid within such period not exceeding 30 years from the date of the making of the loan or, in the case of loans for the construction of new houses where the loan is made by instalments, from such date not later than the date of the payment of the final instalment as may be determined by the housing authority.

Manner of repayment.

8. Loans shall be repaid by an annuity of principal and interest combined and all payments shall be made at monthly intervals.

Interest rates.

9. The rate of interest on a loan shall be such rate as may be charged from time to time by the housing authority making the loan provided that the rate shall not be less than the rate at which money is lent to housing authorities by the Agency, for the purpose of making such loans, and shall not exceed 0.75 per cent more than such rate.

Duties of Housing Authorities.

10. (1) Before making a loan a housing authority shall be satisfied that—

(a) the borrower intends to occupy the house as his or her normal place of residence;

(b) the value of the ownership of the house is sufficient to provide adequate security for the loan;

(c) the title to the ownership is one which an ordinary mortgagee would be willing to accept;

(d) the borrower is not a borrower in respect of any other loan made by them under the Act; and

(e) the Consumer Credit Act 1995 requirements and all other relevant statutory requirements have been met.

(2) For the purposes of carrying out its duties under article 10(1), a housing authority may accept receipt of an undertaking from the borrower’s solicitor to–

(a) give effect to the execution of an instrument referred to under this article,

(b) furnish good marketable title to ownership to the housing authority,

(c) attend to stamping and registration of all title deeds, and

(d) hold all title documents in...