Ennis Town Council

Annuity Loans

If you are unable to get a loan from a building society or bank, you may be eligible for a mortgage from Clare County Council. The loan can be up to 95% of the price of the house subject to a maximum loan of €165,000 and subject to repayments that are no more than 25% of the household gross income (i.e. income before tax and PRSI). A local authority mortgage is an annuity mortgage with variable interest rates. Therefore, repayments will go up and down with general interest rates.

How to Apply

Application forms should be submitted to Housing Administration Section, Clare County Council, Clare Business Centre, Francis Street, Ennis, Co. Clare.

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Loan Amount

The amount of loans applicable is based on 95% of the cost of the house or 95% of our Engineer's valuation of the house or 2½ times the principal earner's current income, whichever is the least.

Rules

You may be eligible for a local authority mortgage if you can show the local authority that you cannot get a loan from a bank or building society and you are:

  • in need of housing and your income satisfies the income test below
  • registered on a housing waiting list with a local authority
  • a local authority tenant or a tenant purchaser and you want to buy a private house and return your present house to the local authority
  • a tenant for more than one year of a home provided by a voluntary body under the Capital Loan and Subsidy Scheme (previously known as the Rental Subsidy Scheme) and you want to buy a private house and return your present house to the local authority.

Note that the income test only applies to the first and second category; if you are covered by the third or fourth category you are exempt from the income test.

The Income Test

  • Single income household: If your gross income (before tax) in the last income tax year was €36,800 or less, you are eligible.
  • Two income household: Multiply the gross income (before tax) of the higher earner in the last income tax year by 2.5 and add the gross income of the other earner in the last income tax year. If the answer is €92,000 or less, you are eligible.

Memorandum on the Making of Loans for the Erection and Purchase of Houses

Housing Acts 1966 and 1992 and Housing Regulations 1980 as Amended Annuity Loan Memorandum on the Making of Loans for the Erection and Purchase of Houses

  1. Introduction
    The Clare County Council (hereinafter called "the Council") is prepared to consider applications for loans for the erection or purchase of houses in the Administrative County of Clare (including the Urban Districts of Ennis and Kilrush) subject to the provisions of Section 11, Housing (Miscellaneous Provisions) Act 1992 (hereinafter called "the Act") and subject to the terms and conditions of this memorandum.
  2. Eligibility for Loans
    1. Persons who are eligible under the scheme may apply to their local authorities for house loans in respect of houses for which contracts to purchase have been entered into on or after 1st May 1995, or in the case of applicants building their houses, where the foundations were completed on or after that date.
    2. Loans will be made to persons, deemed to be eligible in accordance with clause 2(i) of this memorandum, in the following classes:-
      1. Applicants who derive their income solely or mainly from the pursuit of agriculture, where the rateable valuation of the land and buildings occupied by them (and the holdings of his spouse if any) does not exceed €55.87.
      2. Applicants who derive their income solely or mainly from the pursuit of agriculture on land occupied by a parent of the applicant where the rateable valuation or the aggregate of the rateable valuations of the land and buildings occupied by such parent does not exceed €83.80.
      3. Tenants of Local Authority houses, without limit of income, who surrender their tenancy of the Local Authority house on the making of the loan.
      4. A person who is the sole earner and whose income did not exceed €36,800 in the Income Tax year immediately preceding the date of application.
      5. Eligibility in a two income household will be decided on whether the principal income x 2.5 plus the second income exceed the upper limit of €92,000.
    3. Applicants for house purchase and construction loans must furnish evidence that they are unable to obtain loan finance from the commercial lending agencies viz. Building Societies, Banks and Assurance Companies.
    4. Loan will not be made to any applicant who is already a borrower in respect of any other loan made by the Council under the acts of 1966 - 1992 or is the proprietor of a house in respect of which an advance, or any part of an advance, made by the Council under the Small Dwellings Acquisition Acts 1899 to 1962 remaining unpaid.
    5. In order to qualify for loans, the applicant or spouse either individually or jointly, must never previously have purchased or built another house for his or her occupation.

  3. Application
    Application for a loan should be made on a form obtainable from the County Secretary, Housing Administration Section, Clare Business Centre, Francis Street, Ennis.
  4. Application Fee
    The sum of €100.00 must be lodged with the County Secretary with each application for a loan. The fee is not refundable.
  5. Plans
    If the application is in respect of a new house, the applicant must deposit with the County Secretary, Housing Administration Section, 2 house plans, 2 site maps and specification of the house and such other particulars as the Council may require. These plans and specification are in addition to the plans required to be submitted to the Planning Authority under the Local Government (Planning and Development) Acts 1963 to 1993. (a) Applicants for house purchase loans must furnish an auctioneers or Solicitors Certificate stating the agreed purchase price of the house, where it is being constructed by a Builder or in the case where the house is being purchased second-hand.
  6. Maximum Loan
    Subject to paragraph (b) of this clause, the amount of a loan shall not exceed 95% of the value of the house, as determined by the Council, excluding the amount of any grants, or €165,000, whichever is the lesser.
  7. Legal Costs
    The Borrower shall pay part of the Council's legal costs and outlay in investigating the title, preparation of the Mortgage and registration of title. The legal costs will be deducted by the Council from the first instalment of the loan. If the application for a loan is withdrawn, the applicant shall pay to the Council on demand, the legal costs incurred by the Council up to the date of receipt of the notice of withdrawal.
  8. Title
    The title to the ownership of the house must be one which the ordinary mortgagee would be willing to accept. "Ownership" means such interest or combination of interests in a house as, together with the interest of the purchaser of the ownership will constitute either a fee simple (including fee farm) interest in possession or a leasehold interest in possession of such number of years unexpired at the date the loan is made or, where the loan is made in instalments, at the date of the payment of the first instalment, as is equal to or greater than the sum of the term fixed for the repayment of the loan.
  9. Security
    The repayment of the loan to the Council shall be secured either by:-
    1. an instrument vesting the ownership (including any interest already held by the borrower) in the Council subject to the right of redemption by the borrower, or
    2. in a case where the ownership of the borrower consists of a leasehold interest, by an instrument of mortgage by subdemise subject to a nominal reversion, vesting the term of the subdemise in the Council subject to the right of redemption by the borrower, or
    3. where the title to the ownership is registered under the provision of the Title Act 1964 by an instrument charging the ownership with payment to the Council of the amount of the loan together with the interest thereon.
  10. Conditions
    1. A house, in respect of the erection or purchase of which loan has been made shall, until the loan with interest thereon is full paid, or until the Council shall have recovered possession of the house in accordance with the provisions of Section 11, of the Housing Act 1992, be held subject to the following conditions:-
      1. every sum for the time being due in respect of principal or interest shall be punctually paid;
      2. the borrower shall use the house as his normal place of residence unless the Council consent to his residing elsewhere either indefinitely or for a specified period;
      3. the borrower shall keep the house adequately insured to the satisfaction of the Council;
      4. the house shall be kept in good structural condition;
      5. the house shall not be used in such a manner as to be a nuisance to the owner or occupiers of adjacent houses;
      6. any person, authorised by the Council in writing for the purpose, may at all reasonable times enter the house for the purpose of ascertaining whether the conditions specified in this article are complied with.
    2. The insurance of a house in respect of which a loan is made is the responsibility of the borrower. The policy which should include the Council's interest, must be produced by the Council's Solicitor, and
      1. where such insurance is effected by the borrower, the receipt for the payment of each premium in respect of such insurance shall be produced by the borrower to the Council on request by them.
    3. The Council will effect Mortgage Protection Insurance on behalf of the borrower and an additional 0.598% will be charged to cover this insurance.
    4. For loans less than €7,618.43 the applicant must provide his tax number and tax district and certify that to the best of his knowledge, his tax affairs are in order.
    5. In the case of loans for €7,618.43 or more, the applicant must submit a current tax clearance certificate issued to him by the Revenue Commissioners.
    6. Regardless of the amount of the loan, the applicant will be required to furnish the name, address, tax reference number and tax district of each contractor undertaking the works together with the number and expiry date of either the contractor's C2 or tax clearance certificate.
  11. Breach of Conditions
    Where default is made in complying with Article 43 of the Housing Regulations, 1980 or in the case of bankruptcy of the borrower, the Council may recover possession of the house (whatever may be its value) under Section 84 and 89 of the Landlord and Tenant Law Amendment Act Ireland 1860 as if the Council were the Landlord and the borrower were the tenant.
  12. Head Rent
    The borrower shall become due and shall, if required, produce to the Council for inspection the receipt therefore immediately after payment of same.
  13. User of House
    The Council shall not make a loan in respect of a house unless the house is used or is intended to be used as the normal place of residence of the borrower.
  14. Repayments
    1. Loans shall be repaid with interest within such period not exceeding 30 years as the Council may determine.
    2. The rate of interest on a loan shall be such as may be fixed by the Council.
    3. A loan shall be repaid by an annuity of principal and interest combined and all payments shall be made at such periods not exceeding a half year as may be determined by the Council.
    4. The borrower may after one months notice in writing, and on paying all sums due on account of interest, repay to the Council the whole of the outstanding principal of a loan or any part thereof, being €50 or a multiple of €50.
    5. Interest only shall be payable up to the first gale day following payment of the final instalment of the loan. Repayment of the principal shall commence on the second gale day following payment of the final instalment of the loan.
  15. Transfer of Interest in House
    1. The borrower shall not, without, the consent of the Council, at any time, transfer his interest in the house and any such transfer shall be subject to the conditions set out in Clause (9) of this memorandum. The borrower shall pay the Council's legal costs in the matter.
    2. A borrower shall be personally liable for the repayment of any such sum due in respect of a loan until he shall have transferred, with the consent of the Council under paragraph (a) of this clause, his interest in the house in respect of which the loan was made.
  16. Instalment of Loan
    Where a loan is made in respect of a new house, the loan may be made by instalments from time to time as the building of the house progresses so that the total instalments do not at any time before completion of the house exceed 90 per cent of the value of the work done up to that time on the construction of the house including the value of the interest of the borrower in the site thereof or 90 per cent of the amount of the loan, whichever is the less.
  17. Standard of Construction
    1. The dwelling must be built to a standard not inferior to that laid down by the Department of the Environment in its explanatory memorandum HA1/78 (any revisions thereof) regarding floor area, standard of workmanship and materials, heating and ventilation, water supply and sewerage, fire safety, thermal insulation etc., and any such other requirements as the Council may make.
    2. Particular attention should be paid to the requirements in Memo HA 1 in regard to garages and undeveloped attic spaces and also in relation to calculation of total floor area of house. The house shall also comply with the outline Specification of the Department of the Environment and the Proposed Building Regulations. The applicant is strongly urged to register a new house with the National Building Guarantee Scheme. In the event that the house is not registered, the applicant will be required to appoint an Engineer to supervise the construction of the house and to provide certificates at various stages of completion. In the case of second-hand houses, a detailed structural inspection will be undertaken to assess its suitability.
    3. In the case of a new house, which is being built on the borrowers own site, VAT registered work of not less than €19,046.07 must be undertaken under contract by registered contractors. More than one VAT registered contractor can contribute to make up the €19,046.07 minimum.
  18. Payment of the Loan
    Payment of the loan or an instalment of the loan will be conditional on the necessary capital funds being available to the Council.
  19. Grant of Planning Copy
     A copy of the Grant of Planning should be submitted with the application.

NB: This memorandum applies to applications where contracts have been entered into on or after 1st May, 1995. In the case of applicants building their house, the memorandum applies where the foundations were completed on or after 1st May, 1995.

It is not the practice of the Council to advance loans for houses in excess of 1,346 square feet (125 square metres) floor area.

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