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- Housing
- Mortgage Allowance Scheme
Mortgage Allowance Scheme
An allowance of up to €11,450 is payable over a 5 year period to tenants or tenant purchasers of Sligo Borough Council housing or tenants of houses provided under the voluntary housing Rental Subsidy Scheme to assist them to purchase or have a private house built with a mortgage.
Generally, you will still have mortgage repayments to meet even taking into account the mortgage allowance. For example, on a mortgage of £80,000 (€101,579) over 20 years from Sligo Borough Council, interest is variable and is currently (January 2001) 6.00% (typical APR 6.17%) (excluding mortgage protection @ 0.67%), the mortgage allowance would reduce your monthly repayments (before income tax relief on mortgage interest) in the first year from about £581 (€738) to about £348 (€442) per month.
Do I qualify?
If you are:- a Sligo Borough Council tenant or tenant purchaser who wishes to buy a private house and to return your present house to the Sligo Borough Council, or
- a tenant for more than one year of a house provided by a voluntary body under the Rental Subsidy Scheme who wishes to buy a private house and return your present house to the voluntary body,
Is the allowance a cash grant?
No. The allowance is linked to your repayments on the mortgage loan taken out to finance the purchase or building of your house. Once you qualify for the Scheme, the Local Authority will issue a 'Certificate of Approval' to you. You must present this certificate to your lending aganey. They in turn apply to the Department of Environment for the allowance on your behalf. It is paid directly to the lending agency and results in your mortgage repayments in the first five years being reduced by the amount of the allowance.To qualify for the allowance must I have a mortgage?
Yes. You must be financing the purchase or building of your house by means of a mortgage loan of at least £30,000 (€38,092).
Can I choose any house I like?
You may buy a new or existing house or have a house built. The house being purchased or built must be suitable to your needs, meet certain minimum standards and be acceptable to the Sligo Borough Council.
How much is the allowance?
The allowance will normally come to a total of £9,000 (€11,428). It is paid directly to the lending agency and reduces your mortgage payments in each of the first five years - by £2,800 (€3,555) in the 1st year, £2,200 (€2,793) in the 2nd year, £1,600 (€2,032) in the 3rd year, £1,400 (€1,778) in the 4th year and £1,000 (€1,270) in the 5th year. The allowance paid in any year cannot exceed the amount of the mortgage repayments. If for instance, your mortgage repayments in the first year came to £2,500 (€3,174), the allowance would be £2,500 (€3,174).
Generally, you will still have mortgage repayments to meet even taking into account the mortgage allowance. For example, on a mortgage of £80,000 (€101,579) over 20 years from Sligo Borough Council, interest is variable and is currently (January 2001) 6.00% (typical APR 6.17%) (excluding mortgage protection @ 0.67%), the mortgage allowance would reduce your monthly repayments (before income tax relief on mortgage interest) in the first year from about £581 (€738) to about £348 (€442) per month.
What if I can’t get a mortgage from a bank/building society?
If you are unable to obtain a mortgage loan from a bank or a building society, you may qualify for one from the Sligo Borough Council.Further Information
The Mortgage Allowance Scheme is available from County Councils, County Borough Corporations and Athlone, Bray and Dundalk Urban District Councils. If you feel that the scheme is an option that may be suited to your circumstances, contact Sligo Borough Council for further information.
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