AIB says it’s ‘imperative that mistakes of the past are not repeated’ as it pauses mortgage applications from those on Covid-19 state supports.
It will apply to people who are on the Temporary Wage Subsidy Scheme and the Pandemic Unemployment Payment.
Theoretically, AIB’s decision will lock over 800 thousand people on COVID-19 state supports out of the mortgage lending process with the bank.
However, it will also impact on couples if one of the applicants is claiming the Subsidy Scheme, and their income won’t be taken into account.
Financial advisor Padraic Kissane thinks the banks are right to be prudent.
However AIB don’t seem to be the only ones applying restrictions, as Karl Deeter from irish Mortage Brokers explains.
Financial Planner Eoin McGee says the decision by AIB is ‘disappointing’, adding that it impacts businesses too.
The Public Expenditure Minister, Michael McGrath, believes existing contracts should be honoured, and will raise the issue with relevant stakeholders.