They have received billions of euro in financial support and, in the case of Bank of Ireland and AIB, direct investment from the taxpayer. But despite this, a Sunday Tribune investigation reveals major variations in what the various state-backed lenders will currently offer to mortgage seekers.

In fact, our survey shows that some are willing to give mortgages of up to five and a half times an individual's salary.

Yet others have put considerable barriers in the way of first-time buyers.

Not least of these is Bank of Ireland, which is operating a controversial "minimum property value" of €175,000 for mortgages on Dublin-based properties, a measure which critics claim is a blatant attempt to "artificially inflate" the market by inhibiting lending on properties worth less than this sum.

Meanwhile, two other lenders visited by the Sunday Tribune as part of a 'mystery shopper' survey said they do not lend to buyers seeking to avail of the government backed "affordable housing" schemes.

This is despite the fact that the provision of such housing, which supporters claim remains generally cheaper than comparable properties in the private market, is part of official government planning policy.

The difficulties faced by local authorities in attempting to sell these types of homes was thrown into sharp relief recently, when it emerged that 12 councils have been given permission to move unsold homes onto permanent social housing stock. This means they will now be directly rented out to people on social welfare.

Posing as a 30-year-old single first-time buyer with a €39,000 annual income who works as a supervisor in a call centre, the Sunday Tribune visited four of the largest mortgage providers in the state to find out what their current lending practices are.

"John" had savings of €12,000 and no other debt or dependents, and was looking for a provisional quote on a mortgage over 35 years.

All of the financial institutions visited – Bank of Ireland, AIB, Permanent TSB and EBS – are covered by the government's banking guarantee.

Both Bank of Ireland and AIB have also received billions of euro in capital injections from the state, while along with EBS, all three are due to transfer significant assets to Nama.

At Bank of Ireland on O'Connell Street, we were told that the bank would provide us with a 92% mortgage of up to €195,000, based on the fictional details we supplied. The bank also lends to purchasers of affordable homes, the adviser said.

When asked if the mortgage could be used to buy a property worth €120,000, or an affordable property of €140,000, she outlined Bank of Ireland's "minimum value" policy for its loans. This stands at €175,000 in Dublin, and between €125,000 and €150,000 elsewhere, she said.

"They may make an exception," she explained. "We'd have to send [your application] off. But the guidelines do say €175,000. They will assess it on a case-by-case basis."

Bank of Ireland was alone among those visited in revealing that it operates a minimum lending value.

Affordable housing

A mortgage adviser at AIB on Capel Street also revealed that it does not provide loans for affordable homes and that we would have to turn elsewhere if we wanted to go down this route.

But the bank was "very much open for business" for a first-time buyer.

He was prepared to offer a 92% mortgage of up to €222,000, which is equivalent to more than five and a half times our purported €39,000 annual salary – and €27,000 more than the figure offered by BoI.

The bank would also lend for properties below this figure, with key criteria including any other outstanding debts which an applicant might have.

At a nearby branch of Permanent TSB on O'Connell Street, the mortgage adviser said it does not provide mortgages for properties under the 'affordable homes' scheme.

Unlike AIB, however, he said this could change if the terms of the sale did not include a 'clawback' provision for the participating local authority.

He was willing to offer a mortgage of €193,000 over 35 years, a figure which he said could be stretched to €215,000, based on previous savings history. Unlike BoI and AIB, Permanent TSB would only provide a 90% mortgage.

By comparison, an adviser at a nearby branch of EBS said it had no problem providing a loan for an affordable home, and would even provide a 100% mortgage for this type of purchase.

The society was willing to provide a 92% mortgage of up to €220,000 based on the details provided.

So where does this all leave prospective first-time buyers and others attempting to take advantage of the collapse in property prices?

According to a spokeswoman for BoI, there is "no reason" why its minimum property values would inhibit prospective purchasers from buying homes in the current market.

"The primary criteria that Bank of Ireland uses to assess a mortgage application is the customer's ability to repay the loan," she said. "Minimum property values are only one of a number of credit criteria and guidelines from which we assess a mortgage application. We process mortgages for all amounts and from as low as €20,000."

"We feel our lending policy is prudently placed and we regularly review it in line with current market conditions."

Others take a far less rosy view of this policy, however.

Labour party finance spokeswoman and deputy leader Joan Burton called on the finance minister Brian Lenihan to force the bank to abandon minimum values for its mortgages.

"They are clearly trying to keep the property market prices up as high as possible," she said. "I think the minister and his officials, who are dealing with each of the guaranteed banks, should intervene to say this is just not on.

"The Department of Finance and the minister have given the banks carte blanche to do what they like and is completely at odds with the needs of the public. There is very little requirement on the banks to offer loans to people on lower incomes. The banks seem to be getting everything on their own terms."

'Pressing need'

Last month, the housing charity Respond told an Oireachtas committee of the "pressing need" for a support scheme to assist the 25,000 families facing mortgage arrears once the current mortgage moratorium being observed by the financial institutions expires in February.

During its presentation, it warned that these families may be facing the possible repossession of their home at that time.

Respond spokeswoman Aoife Walsh told the Sunday Tribune that the 'minimum value' policy employed by BOI "simply doesn't make sense" in the context of the current market. She noted that a prospective mortgage-holder's ability to repay would be more favourable if the amount of the loan was less than €175,000.

She suggested that it could, however, be in the bank's interest to keep property prices as high as possible in the run up to the individual property valuations which are being undertaken as part of the Nama process.

A policy which keeps prices artificially high could also help to limit any losses to the bank from the sale of the expected "flood" of repossessed properties as they come onto the market after February.

Walsh claimed affordable housing is generally still cheaper than property available elsewhere in the market. While this is a contention that some would dispute in the current property market climate, she said that most local authorities have reacted to the downturn by removing the 'clawback' provision on such properties.

This means individuals can generally sell them on as they would a normal property – without owing money to the council.

"It does seem more than a bit odd that government policy is to promote affordable housing provision, yet lenders are refusing to provide mortgages for these," Walsh said.

"It seems like a total swing in terms of the lending practices of the past, where they were giving interest only and 100% mortgages... now they won't lend at all in some cases."

Home Truths: What the banks were offering

The buyer: A 30 year old single first time buyer with a €39,000 annual income working for a private company. Savings of €12,000 and no other debt or dependents, looking for a mortgage over 35 years.

BANK OF IRELAND
Mortgage offered: Up to €195,000
Income multiple: 5
Deposit: 8%
Open for affordable housing: Yes. But operates a 'minimum value'­ €175,000 for mortgages on properties in the Dublin region and between €125,000 and €150,000 elsewhere

AIB
Mortgage offered: Up to €222,000
Income multiple: Approx 5.7
Deposit: 8%
Open for affordable housing: No

EBS
Mortgage offered: Up to €220,000
Income multiple: Approx 5.6
Deposit: 8%
Open for affordable housing: Yes, will loan up to 100% of price

PERMANENT TSB
Mortgage offered: Up to €193,000, but given previous savings history this could stretch to €215,000.
Income multiple: Approx 4.9-5.5
Deposit: 10%
Open for affordable housing: No. But if the "clawback" from local council is removed this may be possible.