Written Answers - Local Authority Loans.

Wednesday, 24 November 2004

Dáil Eireann Debate
Vol. 593 No. 2

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  228.  Mr. R. Bruton  Information on Richard Bruton  Zoom on Richard Bruton   asked the Minister for the Environment, Heritage and Local Government  Information on Dick Roche  Zoom on Dick Roche   the rate of interest which applied to a local authority loan and the added rate of charge for mortgage protection insurance; the monthly payment which will be required in respect of each on a €100,000 loan. [30646/04]

Minister of State at the Department of the Environment, Heritage and Local Government (Mr. N. Ahern): Information on Noel Ahern  Zoom on Noel Ahern  The current local authority mortgage interest rates are 2.95% variable and 4.45% for fixed, which represent competitive rates of lending. The cost of the mortgage protection plan is met by way of an additional charge, currently 0.598%, to the rate of interest charged on individual loans. This mortgage protection charge would be about €50 in the first month on a loan of €100,000, reducing over the term of the loan, with the average charge being around €30.

The position regarding monthly payments on a €100,000 loan is set out in the table below:

Rate Over term of:
15 years 20 years 25 years 30 years
2.95% variable €688 €552 €472 €419

Variable mortgage lending rates shown above may change over the term of the loan. The position for a fixed loan is that they are borrowed for a total of 25 years, the first five of which are fixed at 4.45%. After five years, the borrower may convert to variable or re-fix at the fixed rate prevailing at the time.

In such circumstances, the following payment schedule would apply:

Rate 25 year term
Fixed for initial 5 years at 4.45% 553
If variable thereafter for remaining 20 years at 2.95% 547

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