Questions raised over high rate of refusal of council housing loans

Of 15 housing loan applications made in the Municipal District (MD) of Donegal in 2023, ten were refused, two were approved and the remaining three have been approved in Principal.

Speaking at the July meeting of the Municipal District (MD) of Donegal, Cllr Micheál Naughton (FF) questioned the high refusal rate. And he asked if anything could be done to help people to qualify for loans.

“Is it the criteria that is leading to such a high refusal rate?” he asked. “We need to get clarification on that.

“I know you have to get two refusals from banks to come to the council. 

“There are a lot of households where people are working but they are caught in the middle. They are over the threshold for local authority house but can’t get a mortgage.

“These people are paying rent that would pay a mortgage but they can’t get one.

“I know this is something that comes from the Department, but we need to look at it.

“There is a huge need.”

Donegal County Council’s Area Manager for Housing and Corporate Services Pauric Sheerin said there was a lot of due diligence around housing loans

“We are a lender of last resort, and the criteria and records that we have to look at are fairly significant for everyone,” he said. 

“But there is nothing that jumps out at me that I would remove because of it being too strict. 

“We have to apply due diligence that the person entering into that loan arrangement has the ability to repay it. 

“The bar is there to ensure that anybody who is approved for a loan under that scheme will be able to sustain the repayments.”