Cavan/Monaghan Fianna Fáil TD Brendan Smith has been informed by the Minister for Housing, Planning and Local Government that homeowners with local authority mortgages will be able to apply for a mortgage payment break as a result of the Covid-19 Emergency.
The Minister added that such mortgage borrowers who face mortgage payment difficulties can apply for a mortgage break of up to 3 months.
Deputy Brendan Smith in a Dáil Question had asked the Housing Minister if a mortgage moratorium would be introduced in respect of local authority house loans due to difficulties that have arisen for so many households because of Covid-19.
Minister Murphy in his reply to Deputy Brendan Smith in Dáil Éireann stated –
“On 19 March 2020, I confirmed that homeowners with local authority mortgages would be able to apply for a mortgage payment break as a result of the COVID-19 emergency. To implement this, on Friday 10th April I issued Circular 9 2020 to each local authority confirming that local authority mortgage borrowers who face mortgage payment difficulties can apply for a mortgage break of up to 3 months.
This is in line with measures put in place by commercial banks. The mortgage payment break, which applies to all local authority mortgage products, will be available to borrowers who have already faced mortgage difficulties due to the COVID-19 emergency and those who may encounter difficulties in the near future.
The approach being taken will ensure that no additional costs to the original home loan balance will arise for any borrower availing of these measures, as borrowers are not charged interest for the period of the break. At the end of the payment break period, repayments will be adjusted so that the mortgage will be repaid within its original term. To achieve this, the break period repayments will be spread over the remaining mortgage term.
The aim has been to ensure a simplified application process that can be accessed easily and through which applications can be processed efficiently, so that borrowers in distress can access the payment break quickly. Any local authority borrower facing difficulties due to COVID-19 should contact their local authority as soon as possible, in particular to access the application form and information that will be available on each local authority’s website.
Borrowers should apply to their local authority and have approval for the payment break before stopping their mortgage payments. An agreed Mortgage Payment Break will not adversely impact on a borrower’s credit record.
These measures will help ease some of the short-term financial concerns faced by local authority borrowers. They will be kept under review and assessed in line with other developments in the COVID-19 emergency.” concluded Minister Murphy in his reply to Brendan Smith TD.
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