Housing (Local Authority Loans) Regulations 2012

• Jurisdiction: Ireland
• Year: 2012
• Citation: IR SI 408/2012

Notice of the making of this Statutory Instrument was published in

“Iris Oifigiúil” of 30th October, 2012.

I, JAN O’SULLIVAN, Minister of State in exercise of the powers conferred on the Minister for the Environment, Community and Local Government by section 11 of the Housing (Miscellaneous Provisions) Act 1992 (No. 18 of 1992) (as adapted by the Environment, Heritage and Local Government (Alteration of Name of Department and Title of Minister) Order 2011 ( S.I. No. 193 of 2011 ), which powers are delegated to me by the Environment, Community and Local Government (Delegation of Ministerial Functions) Order 2012 ( S.I. No. 148 of 2012 ), at the Department of the Environment, Community and Local Government, and with the consent of the Minister for Public Expenditure and Reform (pursuant to the Finance (Transfer of Departmental Administration and Ministerial Functions) Order 2011 ( S.I. No. 418 of 2011 )), hereby make the following regulations:--

Citation and commencement.

1. (1) These Regulations may be cited as the Housing (Local Authority Loans) Regulations 2012.

(2) These Regulations shall come into operation on 31 July 2012.

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, Community and Local Government;

“value” means;

(a) In the case of an existing or 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 Principal Act;

(b) the purchase of a dwelling under Part 3 of the Housing (Miscellaneous Provisions) Act 2009 (No.22 of 2009);

(c) the purchase of an apartment under Part 4 of the Housing (Miscellaneous Provisions) Act 2009 ;

(d) the purchase of an affordable house within the meaning of Part 2 of the Housing (Miscellaneous Provisions) Act 2002 (No. 9 of 2002), or Part V of the Planning and Development Acts 2000 to 2010; and

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

Amount of loans

4. The amount of a loan shall not exceed—

(a)€200,000; 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 1.25 per cent more than such rate.

Duties of Housing Authorities

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

(a)...