Banks are being called on to be consistent in how they deal with mortgage applicants whose employers are using the State wage subsidy scheme.
It comes after a leading bank was set to deny a couple a mortgage to buy their dream home, just as they were about to draw down the loan.
Only after the Irish Independent asked the bank questions about the case did it perform a U-turn.
A number of house hunters have reported banks pulling the plug on their mortgage application just as they are about to sign documents to buy the home.
This is happening despite loan offers being in place, the stage where a property is identified for purchase.
The banks are reneging on offers even though the applicants are not in receipt of the Employment Wage Subsidy Scheme (EWSS), but because their employer is availing of the scheme.
In some cases banks are pulling the loan offer a day before sale documents are due to be signed, leaving some people with nowhere to live, leaving them distraught.
Mortgage adviser Michael Dowling said banks need to stop making what he called arbitrary decisions, that a company availing of the wage subsidy scheme is going to fail.
Almost 40,000 employers are using the scheme, according to Revenue.
Mr Dowling said a distinction needs to be made between an employer receiving the wage subsidy and the employee.
Many mortgage refusal cases that were now cropping up were because the employer was availing of the scheme, even though the employees were not themselves receiving the subsidy.
He pointed out that people earning more than €78,000 a year are not entitled to have their wages subsidised under the EWSS scheme.
“Banks are making arbitrary decisions.
"There seems to be a view that because the employer is using the EWSS the business will fail,” Mr Dowling said.
Some of the biggest names in business are availing of the EWSS scheme. These include Volkswagen Group, Ryanair, Aer Lingus, Nando’s, the K Club, RTE, Brown Thomas and Donald Trump’s Doonbeg hotel and golf course.