There was good news for home buyers this week with the announcement that the Central Bank is proposing to allow credit unions to offer home loans “in a meaningful way” (we are not really sure what that means…). Selected credit unions out of the 264 across Ireland already offer home loans in limited circumstances and have apparently processed a total of €43 million worth of mortgage lending to date across Ireland.
Following a review, the Central Bank published a report, which is open to consultation until January 2019, outlining a range of changes and measures that would bring credit unions within the lending framework. This follows a series of announcements about new mortgage lenders into the Irish market – including the Post Office – which will lead to much greater competition and choice for property buyers.
Interestingly, the Irish Independent reported on research that found almost 60% of credit union members would consider switching their mortgage to the credit union if a better deal was available. On the basis that the Post Office has pledged to offer mortgage interest rates at least 1% below market rates, it is likely that the credit union will fall somewhere between the two.
Outside of the benefits for home buyers, adding a new range of services to the existing credit union offering will ensure financial stability for them. Surprisingly, there has also been talk of the credit unions also being able to offer commercial loans, within strict conditions. It appears that the local institutions have seen their loan books shrink over the past few years as members increase savings but decrease loans.
If the proposed changes go ahead, the credit unions will be able to issue an estimated €1.3 billion worth of mortgages. One thing is for sure, the choice of mortgage lender for home buyers is growing and this is a welcome development as new home delivery starts to speed up in Wexford.
For your FREE, no obligation, valuation in the South Wicklow and North Wexford area, call into one of our offices (located in Carnew and Gorey) and chat to any of our expert team or you can contact us online at kinsellaestates.ie. We are happy to facilitate overseas buyers and sellers via Skype or similar, outside of regular office hours. Alternatively, email me directly on firstname.lastname@example.org or telephone: +353 53 94 21718