County Council Mortgages

Cork2015!

Just wondering if anyone on here has had any experiences with county council mortgages?

I have done some research online an can't find much.... I know you need letters of refusals from banks and that the deposit required is 3% but can't find much else

I am planing on ringing about it next week and make some inquiries but am trying to arm myself with as much information as possible first.

My main question - Obviously if you need refusal letters from banks the council is aware of the fact that you are not a perfect candidate (from banks point of view) - so does this mean that they are more lenient than the banks regarding previous poor credit?

Or is it simply the case that the refusals from the banks are because you don't have the extra deposit that you would need?

If anyone has any type of experience with this process I would love to hear it

Michael D Not Higgins

I have not seen any clarification on whether the councils still issue mortgages and if they do, whether they are regulated by the central bank rules on lending. You would need to speak to the council about the arrangements that are in force.

athtrasna

Try a search on this forum. It comes up about once a month

Mod

BUBBLES1978

http://www.citizensinformation.ie/en/housing/local_authority_and_social_housing/buying_your_local_authority_house.html

Everything you need to know is here, its a new scheme that is open this year. first thing you need to do it check the house you are in, is an eligible house for this purchase scheme then best advice i can give is contact your local co council as they are in the early stages and might be tweaking it differently

other information is this:

Yes the scheme opens on 1st January. Not every house is eligible,
Basically the house is valued and you get a discount based on your income as follows

Discount of 60 % if your income is between €15,000-€20,000
Discount of 50% if your income is between €20,001-€29,999
Discount of 40% if your income is greater than €30,000

(social welfare income isn’t counted so it will probably be based on your gross income from work)

Michael D Not Higgins

BUBBLES1978 wrote: »

http://www.citizensinformation.ie/en/housing/local_authority_and_social_housing/buying_your_local_authority_house.html

Everything you need to know is here, its a new scheme that is open this year. first thing you need to do it check the house you are in, is an eligible house for this purchase scheme then best advice i can give is contact your local co council as they are in the early stages and might be tweaking it differently

other information is this:

Yes the scheme opens on 1st January. Not every house is eligible,
Basically the house is valued and you get a discount based on your income as follows

Discount of 60 % if your income is between €15,000-€20,000
Discount of 50% if your income is between €20,001-€29,999
Discount of 40% if your income is greater than €30,000

(social welfare income isn’t counted so it will probably be based on your gross income from work)

That's for buying a council house, not getting a council mortgage to buy a private house.

mayo92

Has anyone had any luck with this or have any information?
I called the council to enquire and felt i was being fobbed off. I'm not looking for a big mortgage(80-90000. Repayments would be less than my current rent which is already very low! I have been refused by bank because of my low wages even though I have proof(in rent & savings) I can well afford it.
It would be great to get this as interest rate is low and 3% deposit would leave money for furnishing the house etc as I was presuming I would need 10%!

TENHNY

I am currently in the process of it, its long drawing out but hopefully worth it, Ring up and ask them to post out home loan application form, you have to have savings,show the ability to pay have a meeting with their board.
Best of luck

09_09_09

mayo92 wrote: »

Has anyone had any luck with this or have any information?
I called the council to enquire and felt i was being fobbed off. I'm not looking for a big mortgage(80-90000. Repayments would be less than my current rent which is already very low! I have been refused by bank because of my low wages even though I have proof(in rent & savings) I can well afford it.
It would be great to get this as interest rate is low and 3% deposit would leave money for furnishing the house etc as I was presuming I would need 10%!

http://www.dublincity.ie/sites/default/files/content/Documents/House_Purchase_Loan_Application_Form.pdf

This might be helpful if you are planning to buy in or around Dublin.

riclad

You would need to find a house for sale 80-90k ,thats not easy in dublin.
council will need survey to show its in good structural condition .

mayo92

TENHNY wrote: »

I am currently in the process of it, its long drawing out but hopefully worth it, Ring up and ask them to post out home loan application form, you have to have savings,show the ability to pay have a meeting with their board.
Best of luck

Thanks Yea I have all that so fingers crossed. Do you know do they use the same limit as the banks with 3 and half times your salary? Or as it is not technically a mortgage can they be more lenient?

mayo92

riclad wrote: »

You would need to find a house for sale 80-90k ,thats not easy in dublin.
council will need survey to show its in good structural condition .

Yea I am in mayo so maybe a bit easier

Michael D Not Higgins

mayo92 wrote: »

Thanks Yea I have all that so fingers crossed. Do you know do they use the same limit as the banks with 3 and half times your salary? Or as it is not technically a mortgage can they be more lenient?

It is a mortgage but I think the county councils aren't under the remit of the Central Bank if they can give loans of 97%. What they will want instead is a maximum limit of your disposable income to be payable to the mortgage. They're not going to grant a mortgage above a certain level (maybe 35% of your net income) but at the lower end of the scale that could easily be above the 3.5 limit.

For example if your income is 20k, your net is ~1500 per month. At 35% that's a max mortgage payment of 525 per month. That would more than support a 97k mortgage with 3k deposit at the interest rates the council charge and including stress testing. That would also be an LTI of 4.85. This is all subject to the other criteria they apply such as regular saving and expenses.

mayo92

Thats brilliant thanks for the info. It all makes sense on paper so hopefully it's not something they have to advertise but don't actually like to give out. It is something that is never advertised and could help out so many people. If they could give me this it will free up the house i am currently renting which is what is needed!!

mayo92

Sorry that is a bit contradictory!! I meant it is not widely advertised or known about. I had go searching to find out this was even a possibility

Cork2015!

How did you even go about applying?
I have tried really hard and can't find right info online anywhere

Michael D Not Higgins

mayo92 wrote: »

Sorry that is a bit contradictory!! I meant it is not widely advertised or known about. I had go searching to find out this was even a possibility

They are not easily granted and particularly the rate of non performance of the loans is twice as bad as the private banks, so they are in no hurry to lend more. You'll need to jump through quite a few hoops to qualify.

Good luck though, I hope it works out for you.

coffeyt

I got a council mortgage last year to purchase a property, very long drawn out process but got there eventually. Just to advice also if you are currently renting a council property you can also apply for the mortgage allowance scheme. If you get the mortgage this is a grant that basically reduces your mortgage repayments over the first five years. Worth looking into also as its worth approx €11000 over the 5 years if granted.

coffeyt

Also even though you apply through your own council all applications are processed by a department in Dublin(dept of environment if I remember correctly), if you go to housing.gov.ie and search for local authority loans you can see all the information needed, hope this helps and best of luck. If you have any questions feel free to ask!!

mayo92

coffeyt wrote: »

Also even though you apply through your own council all applications are processed by a department in Dublin(dept of environment if I remember correctly), if you go to housing.gov.ie and search for local authority loans you can see all the information needed, hope this helps and best of luck. If you have any questions feel free to ask!!

Thanks for the info Just wondering for the refusal letters, do they need to have a specific amount or is a generic letter okay? I asked my own bank to send me refusal letter but it came with no amount stated. I asked a Building Society who ant 20 for it and asked it I wanted it blank or a specific amount stated.

Also just wondering if you need to have a specific house decided on? I do have one in mind but I would rather get approved in principal before spending money on getting in surveyed etc..

By looking at the appplication form it looks like you need to have everything in place but obviously don't want to do this incase it gets refused as this is probably my last hope to buy in the near future!!

coffeyt

Hi no problem I know how frustrating it can be trying to get the info you need!!! With regards the letters of refusal from bank, yes they do require that the amount that you applied for be on the letter. And regards the house details you will need to send in details of a property but we just picked a generic one in our area for the amount we were looking to borrow, the process of applying and getting the letter advising we had the loan took nearly 6 months so realistically that house could be sold so you can use the funds to purchase a different house to the one you initially applied for. I still have the copy of our original application so any more questions you need answered work away!!

Tasden

Coffeyt very helpful posts, thank you!

mayo92

coffeyt wrote: »

Hi no problem I know how frustrating it can be trying to get the info you need!!! With regards the letters of refusal from bank, yes they do require that the amount that you applied for be on the letter. And regards the house details you will need to send in details of a property but we just picked a generic one in our area for the amount we were looking to borrow, the process of applying and getting the letter advising we had the loan took nearly 6 months so realistically that house could be sold so you can use the funds to purchase a different house to the one you initially applied for. I still have the copy of our original application so any more questions you need answered work away!!

Thanks so much.... really appreciated. I might be on to you in a few weeks! When I called she was telling me to go on the housing list and to call her back in a month and she would have a chat with me about how much I could borrow.

I don't know if this is needed or is it just to make them look good by taking someone off the housing list?!

coffeyt

Well I got my mortgage from Tipperary county council so maybe there is slight differences but there was no requirement to be on housing list. In fact it mentioned if we were renting privately we needed to supply a copy of lease. I found that most council employees had very little idea how the scheme worked, even the lady we dealt with once we were approved kept on having to check info. My best suggestion would be just to request a loan query form, fill it in and go into council office to hand it in. There is a small fee you have to pay (was €40 in tipperary but again it varies) and go from there. We asked a local councillor in the end to be honest as like you we kept getting the run around and he got the initial form posted to us and advised who to deal with.

coffeyt

Just to say we didn't know local councillor so just got his number and explained what we were looking for. Once you complete the loan query form they will assess whether or not you meet the criteria, if you do you then you will get an official application form to complete which is what gets sent to Dublin by your local council. The initial application took us about a month and then we were waiting over 3 months to hear back from Dublin.

mayo92

Yea i thought that. I called in to the office one day to enquire and the lady at the desk quickly went through the requirements she had on paper (which all seem pretty straight forward) and then handed me the application form. It was only when I got home it looked like a lot to get together when I had no idea how much they would be willing to give me or even sitting down and having a chat with someone.

My wages are about 1500 a month which is low but I know I can afford the repayments as they would be a lot lower than I have been paying in rent for the last 7 years but they may not see it like that!

Tasden

mayo92 wrote: »

Yea i thought that. I called in to the office one day to enquire and the lady at the desk quickly went through the requirements she had on paper (which all seem pretty straight forward) and then handed me the application form. It was only when I got home it looked like a lot to get together when I had no idea how much they would be willing to give me or even sitting down and having a chat with someone.

My wages are about 1500 a month which is low but I know I can afford the repayments as they would be a lot lower than I have been paying in rent for the last 7 years but they may not see it like that!

Do you not need to be earning over 35k to apply?

mayo92

Tasden wrote: »

mayo92 wrote: »

Yea i thought that. I called in to the office one day to enquire and the lady at the desk quickly went through the requirements she had on paper (which all seem pretty straight forward) and then handed me the application form. It was only when I got home it looked like a lot to get together when I had no idea how much they would be willing to give me or even sitting down and having a chat with someone.

My wages are about 1500 a month which is low but I know I can afford the repayments as they would be a lot lower than I have been paying in rent for the last 7 years but they may not see it like that!

Do you not need to be earning over 35k to apply?

Really? I know the maximum you can be earning is 50k but I didn't read anything else

coffeyt

If your single you have to earn under €50000 and if a couple under €75000. There is no minimum amount but your repayments have to be under 35% of your net household income. As an example my loan for €92000 costs just shy of €400 a month which includes the mortgage protection you have to get through the council!

coffeyt

Also mayo92 my earnings would have been only a bit more more than yourself but my repayments work out well under 25% so by the looks of it you would be well within the guidelines for the amount you want. Just bear in mind as well as the 3% deposit you have to cover solicitors fees and stamp duty also so need to be able to show that amount in savings.

coffeyt

Sorry also meant to say my loan is over 30 years so my figures are based on that. But 35% of your net income would be 525 so your repayments have to be under that which on a 90000 mortgage over 30 years it would be! 😀

mayo92

coffeyt wrote: »

Also mayo92 my earnings would have been only a bit more more than yourself but my repayments work out well under 25% so by the looks of it you would be well within the guidelines for the amount you want. Just bear in mind as well as the 3% deposit you have to cover solicitors fees and stamp duty also so need to be able to show that amount in savings.

Yea that's what I thought. Yea that's no problem as I was expecting to have to have 10% deposit by going with the banks. Even with the banks everything shows I can afford it but they want you to have 1350 disposable income which was the problem!
That's brilliant to have your own house for that money It will also free up a house for someone that needs it in this rental crisis!
Lets hope they think logically when doing this!!