Mortgage applicants who benefit from the wage subsidy scheme are facing issues on multiple fronts. These unfortunate mortgage applicants are having difficulties getting to the drawdown stage with their banks as well as well as having issues with the government’s first-time home buyer scheme.
Multiple news organizations, such as TheJournal.ie, have uncovered situations where people have had difficulties getting to the drawdown of their mortgage since their employer has opted into the wage subsidy scheme. You can read more about that here if you’d like. This scenario has even played out with mortgage applicants on the wage subsidy scheme who had prior approval. Unfortunately, this problem isn’t exclusive to mortgage applicants on the wage subsidy scheme as more applicants on a government-backed scheme are also facing a similar issue.
The Rebuilding Ireland Home Loan (RIHL) is the government scheme currently causing a fuss for first time home buyers. By opting into this scheme through a local authority, buyers can obtain a home loan. This home loan can be used to purchase either a new home, a second-hand property, or for a self-build.
The government housing scheme issued has started up as a result of a Department of Housing ruling on July 6th. In this ruling, the Department of Housing stated that mortgage applicants could only get to the drawdown of their mortgage after the mortgage applicants in question could prove they were off the wage subsidy scheme for 3 months.
This decision has made waves on the Irish political scene. While the new Housing Minister Darragh O’Brien has denied that there is now a complete ban on RIHL applicants who are on the wage subsidy scheme, other political parties have disagreed. Opposition TDs have stated that this Department of Housing ruling is a blanket mortgage ban on RIHL applicants who receive the wage subsidy scheme.
Rebuilding Ireland Home Loan
The Rebuilding Ireland Home Loan was only one of the measures proposed by the previous government to help people get the chance to buy a home.
The Rebuilding Ireland Home Loan has led to more than €500 million being loaned to first-time home buyers to help them purchase a home, but it still has some problems.
The housing spokesperson for Sinn Féin, Eion Ò Broin, has stated that there must not be a blanket ban on people who are on the wage subsidy scheme. Additionally, Mr. Ò Broin stated that he is not advocating the giving of loans to people who can’t pay these loans back. Mr. Ò Broin requested that the minister to tell the truth to customers who have an approval in principle that are waiting to move to the draw down funding phase.
Minister O’Brien stated that there was not a blanket ban, and that the requirement for customers to be off the wage subsidy for 3 months was necessary to allow banks the ability to lend cautiously in regards to the future.
This article was written by Ian, an intern at Irish Mortgage Brokers and Yes.ie from the USA.
References:
https://www.thejournal.ie/mortgage-wage-subsidy-5170246-Aug2020/