The First Home Scheme

A mortgage is simply a long-term loan that’s used to pay for a house.

There are a number of easy ways to begin your application:
Get in touch with a mortgage broker, who will do all the work for you or get in touch with the lenders directly. Obviously, we would recommend the mortgage broker route as they will shop around all the lender and provide you with the best options for you. I would suggest dealing with a fee-based broker though. If the broker is not charging a fee, then they will only deal with lender who pay them a commission, which means you only get options from a select number of lenders rather than the entire market.

Here are some tips on getting mortgage ready

With a fixed-rate mortgage, your interest rate and monthly repayments are fixed for a set time as agreed between you and the lender. You can choose the best time frame for you.

Although a fixed rate means your repayments cannot increase for a set period of time, your repayments will not fall during the fixed rate period. As a result, you could miss out on lower interest rates and lower repayments. Fixed rates may cost more over the long run, but they offer peace of mind as you know your repayments will not rise during the fixed rate period.

We would recommend speaking with a mortgage broker though, you can discuss all rate options and they will help you decided whether a variable rate fixed rate is right for you. They will also be able to do market research for you on the best rates available for you.

Variable rates offer the most flexibility. They allow you to increase your repayments, use a lump sum to pay off all or part of your mortgage or re-mortgage without having to pay any fixed rate breakage fees.

However, because variable rates can rise and fall, your mortgage repayments can go up or down during the term of your loan.

How much will my repayments be every month?

Your repayments will depend on how much you borrow, the term or length of your mortgage as well as the interest rate that you’re charged. See this handy online Mortgage Calculator for an indication of how much your monthly repayments might be. We would recommend speaking with a mortgage broker though, you can discuss all rate options and they will help you decided whether a variable rate fixed rate is right for you. They will also be able to do market research for you on the best rates available for you.

The minimum loan amount you can borrow for a mortgage approx. €40,000. The minimum loan amount for a top-up, can also be called a further advance, is €25,000.

When giving you a mortgage, lenders use different criteria to decide how much they are willing to lend you and they must follow specific Central Bank of Ireland rules when doing this.

The Central Bank of Ireland’s rules apply limits to the amount that lenders in the Irish market can lend to mortgage applicants. These limits apply loan-to-income (LTI) ratios and the loan-to-value (LTV) ratios for both family homes and buy-to-let properties and are in addition to the lenders’ individual credit policies and conditions. For example, a lender may have a limit to the percentage of your take home pay that can be used for mortgage repayments.

Every mortgage has a life span or term. The minimum term would be 5 years and you could also possibly qualify for the maximum term possible which is 35 years. For a family home the maximum term of the mortgage is determined by your age. The maximum to have the loan repaid is age 68 with some lenders and age 70 with others. For Buy to Let mortgages have a maximum term of 25 years.

A shorter term means you’ll pay your mortgage off quicker, but it also means your monthly repayments will be higher. It is good advice to clear your debts, including your mortgage, as quickly as you can, it is also important to have a life and have to money to do all the other things in life that are important. So, striking the right balance is very important.

You will need certain documents when you apply for a mortgage, and you should keep a copy of anything you give to a lender or broker.

Proof of ID, proof of address, and proof of your Personal Public Service Number (PPSN)

Proof of income: latest P60, payslips, certified accounts if self-employed

Evidence of how you manage your money such as current and loan account statements for the last three to 12 months, depending on the lender

Here is Permanent TSB’s full list of documents required.
Here is AIB’s full list of documents required.
You can see that the lists are very similar, which is the same with all other lenders.
These lists will not be complete for everybody as they do not take account of your individual circumstances.

LTV, or loan-to-value, is all about how much mortgage you have in relation to how much your property is worth. It’s normally a percentage figure that reflects the percentage of your property that is mortgaged, and the amount that is yours (the amount you own is usually called your equity).

For example, if you have a mortgage of €150,000 on a house that’s worth €200,000 you have a loan-to-value of 75% – therefore you have €50,000 as equity.
So, the lenders set LTV limits, which means you need to have a deposit of a certain amount before you can get a mortgage. There are different limits in place depending on what category of buyer you are.

• First-time buyers need to have at least a 10% deposit
• Second and subsequent buyers need to have at least a 20% deposit
• Buy-to-let buyers need to have at least 30% deposit

Lenders have a limited amount of discretion when it comes to these limits and in a calendar, year can make exceptions for:

• 5% of the value of mortgages for first-time buyers
• 20% of the value of mortgages to second and subsequent buyers
• 10% of the value of buy-to-let mortgages

These rules don’t apply to switcher mortgages and housing loans for restructuring mortgages that are in arrears and pre-arrears.

Lenders have a certain amount of discretion when it comes to mortgage applications. For first-time buyers, 20% of the value of mortgages a lender approves can be above this limit and for second and subsequent buyers 10% of the value of those mortgages can be above this limit.

When making a mortgage application it can be tempting to apply for the maximum amount possible. However, you need to make sure you will be able to cope with future events such as an increase in interest rates, having children, redundancy or illness.

You can use this budget planner to work out what you can afford to repay each month and make sure to include a regular amount for ‘unforeseen expenses’. You can use our mortgage calculator to see how much your monthly mortgage repayments would be.

If you have other loans or debt, your lender may offer you a lower amount, ask that you pay off these loans or refuse your application.

The shorter the term of your mortgage, the higher your monthly repayments, but you will pay less interest in total. With a longer-term mortgage your monthly repayments will be lower, but you will pay more in interest over the lifetime of the loan.

Example:

Even a small difference in interest rates can have a big impact on the overall cost of a mortgage.

Example:
When you apply for your mortgage, and over its lifetime, it is important to get the lowest rate possible as it can lead to significant savings.

As well as mortgage repayments there are other costs to consider when it comes to buying a home

When buying a property, or switching your mortgage, it is not just your regular mortgage repayments you need to think about. There are a number of other costs involved which you should be aware of and ask your lender about. Some of these can be reduced or avoided by shopping around.

They include:

• Brokers’ fees – some brokers charge a fee to arrange your mortgage or for mortgage advice. This might be a percentage of the mortgage amount or a flat fee. Not all brokers charge a fee so if you are planning to use a broker it is important to ask about this and to shop around. If a broker is not charging a fee, check with them what lenders they advise on. They may only work with lenders who pay them commission and you may not get a full market comparison.
• Estate agent fees – if you are selling a property and using an estate agent you will have to pay a fee for this service. It is usually between 1% and 2.5% but can also be a flat rate.
• Solicitor’s fees – to look after the legal aspects of your mortgage a solicitor will charge a flat fee or a percentage of the mortgage amount, typically 1% to 2%. It is worth shopping around a few solicitors.
• Valuation fee – this is paid to a professional valuer to estimate a property’s market value and is required by the lender as part of your mortgage application. A valuation is valid for a short period of time, typically four months. You will need to get an up-to-date valuation of your property if you want to switch mortgage. Valuation fees typically run between €150 and €185.
• Structural survey fee – a structural survey is done to find out the condition of a property. If any issues arose during the valuation of the property or it is very old, your lender may insist on a structural survey. Even if your lender does not require it, you may want to get a survey anyway to be sure there are no problems with the building. The amount you will pay can be dependent on the type, age and location of the property. It is not always a requirement for the lender, but it is always recommended to have a structural survey done for your own peace of mind.
• Stamp duty – this is a tax payable on documents when you transfer ownership of a property. For residential property it is charged at 1% of the property value up to €1 million and 2% for anything above that.
• Local Property Tax – this tax, collected by Revenue, is charged on all residential properties and came into effect in 2013. It is a self-assessment tax, and you calculate what is due based on your own assessment of the market value of your property. It can be paid in a lump sum or spread out over the year.

You should take the above into account when you are working out how much you will be able to borrow.

Every lender will look at various criteria before deciding whether to approve a mortgage. Some of the main factors that are taken into account are:

• A good credit history.
• Being aged 18 or over.
• Age not greater than 70 at the end of the mortgage term. With some lender this age is 68.
• Ability to repay – as a guide mortgage repayment on all loans including your mortgage should not exceed 35% of your net income
• Secure employment.
• Continuous employment at least 12years.
• Self-employment for at least 2 years, some lenders require 3 years.
• Good bank account management

With all lenders the primary focus is on your repayment capacity.

All lenders must follow Central bank deposit rules, which require a 10% deposit for first time buyers. So, if the value of your property is €200,000, you’d need a deposit of €20,000. This deposit can come by way of a gift, or part gifted, if you are lucky enough to have some-one willing and able to help you out. Borrowing for your deposit will not be acceptable to your mortgage lender, no matter where you are borrowing for.

You’ll generally need to arrange home insurance and mortgage protection before drawing down your loan.

Home insurance is a property insurance which covers private homes, buildings and contents. The cost of home insurance often depends on what it would cost to rebuild your house and how much it would cost to replace all of the contents of the house. The replace value of your property may be more than the purchase price.

When taking out a mortgage you’ll also need to consider how it’ll be paid off in the unlikely event of your death before the mortgage has been fully repaid. When you get a mortgage to buy your home, you’ll generally be required by your lender to take out mortgage protection. This is a particular type of life assurance taken out for the term of the mortgage and is designed to pay it off on the death of the borrower or joint borrower before the end of the mortgage term.

Wherever you are on your mortgage journey, whether you’re ready to make an application, or just want to ask some questions – we’re here to support you so book an appointment today with our mortgage team!

We’ll outline the mortgage process and the required documents you’ll need for your application and you can then gather and submit the documents required at a time that suits you, Allow 1-2 weeks for gathering these documents.

Once the lender receives your application and supporting documentation, they will get back to you in 3 working days to let you know if it’s ready to go to our underwriting team for a full assessment, or if they need any further documents or information from you first.

Once they submit the documents to their underwriting team for a full assessment, they will let you know if they can approve your application within 10 working days. In the rare event that they can’t come to a decision in that timeframe, they will be in touch to let you know and to inform you of when they will have a decision.
If you are using a mortgage broker the lenders will communicate this update to them who will in turn communicate with you.

Once your application for credit is approved, (called approval in principle, AIP) and you have found your home, you will be required to arrange for a valuation of your property. A credit check will also be undertaken on all applicants for the mortgage, and you will need to arrange Life Insurance and Home Insurance. Your lender will issue the loan offer to your solicitor and once you sign the documents, your solicitor will arrange the transfer of funds and collection of your keys to your new home.

Yes, is the answer in most cases, but it is the right answer for everyone. So, get advice from unbiases mortgage broker. If

If you decide that switching your mortgage is the right for you, there are different lending criteria for different types of borrowers.

Check here to see which category you fall into:

Switching my mortgage with no additional funds

• Maximum Loan to Value (LTV) of 90%
• Minimum mortgage amount of €40,000
• Minimum term of 5 years
• Maximum term of 35 years

Switching my mortgage and looking to borrow additional funds (via Equity Release):

• Maximum Loan to Value (LTV) of 85%
• Minimum mortgage amount of €40,000
• Minimum term of 5 years
• Maximum term of 35 years

Switching my Buy-to-Let mortgage.

• Maximum Loan to Value (LTV) of 70%
• Minimum mortgage amount of €40,000
• Minimum term of 5 years
• Maximum term of 25 years

Before switching, please make sure to take advice from a mortgage broker to make sure you are getting analysis of the entire marketplace.

There are costs involved in switching your mortgage to a new provided. Some lenders do offer Cashback & Incentives to cover these costs.

Two Reasons why you would consider Switching Your Mortgage.

1. Low-Interest Rates

Fixed-rate mortgages are at an all-time low in Ireland, and so the time to switch has never been better. Your mortgage broker will compare the market to find you the best deal based on the outstanding amount owed and the term of your mortgage and provide you with impartial advice on choosing the right mortgage for your home. Make sure the broker you choose is comparing the entire marketplace,

1. Release Equity

If you have equity in your home, you could release some of that when switching your mortgage for home improvements or repairs. Alternatively, you could potentially use this opportunity to consolidate other debts into one affordable monthly repayment. Speak to your mortgage broker for advice.

While mortgage switching might not be suitable for everyone (if you have negative equity or impaired credit rating, for example), most homeowners can benefit from switching their mortgage to a new lender. If your current interest rate is more than 3%, there is a good chance that you could save a considerable amount of money, reduce the term of your mortgage, or do both by making the switch.

It’s easy to put things like this on the back-boiler and promise yourself that you’ll do it later, but the earlier you switch, the sooner you’ll start saving money.

Switching mortgage has never been easier, and by employing the services of an unbiased mortgage broker with your best interests at heart, the only thing you’ll have to do is sign on the dotted line to start reaping the rewards of your new mortgage plan.

As part of the switching process, a valuation of your property will need to be completed. You will also need to appoint a solicitor to take care of the legal work involved. However, the cash back offered by some lenders will go a long way to covering your legal fees!

Before switching, please make sure to take advice from a mortgage broker to make sure you are getting analysis of the entire market-place.

Property stamp duty is only payable on the purchase of a property and does not apply when switching your mortgage.

Wherever you are on your mortgage journey, whether you’re ready to make an application, or just want to ask some questions – we’re here to support you so book an appointment today with our mortgage team!

We’ll outline the mortgage process and the required documents you’ll need for your application and you can then gather and submit the documents required at a time that suits you, allow 1-2 weeks for gathering these documents.

Once the lender receives your application and supporting documentation, they will get back to you in 3 working days to let you know if it’s ready to go to our underwriting team for a full assessment, or if they need any further documents or information from you first.

Once they submit the documents to their underwriting team for full assessment, they will let you know if they can approve your application within 10 working days. In the rare event that they can’t come to a decision in that timeframe, they will be in touch to let you know and to inform you of when they will have a decision.
If you are using a mortgage broker the lenders will communicate this update to them who will in turn communicate with you.

Once your application for credit is approved, (called approval in principle, AIP), you will be required to arrange for a valuation of your property. A credit check will also be undertaken on all applicants of the mortgage, you will have to provide the mortgage protection and house insurance.

A Letter of Approval will then be issued to your solicitor who will your work with your new lender and existing mortgage provider to finalise your switch.

This is a question we get asked to allot. The answer is no, but…
Check is your current rate, if you are on a fixed rate and are looking to switch lender before it’s due to end there may be a break fee to get out the fixed rate. It should be on a sliding scale though.

Other than this you cannot be penalised for looking to switch mortgage provider. This includes anyone who has gotten a ‘cashback mortgage’. 

If you received cashback as part of your original mortgage, you do not have to pay any of this money back when switching. 

Know your current situation.
Find out the following as the lender will need to know

• how much is still owed on your existing mortgage
• the term remaining.
• the interest rate you’re currently paying

You can find all this information on your most recent mortgage statement or by contacting your lender. You’ll also need an estimate of how much your home is currently worth. 
With the above info to hand, you can compare mortgage rates to find out who’s offering the best rates and whether it makes financial sense to switch. 

You can give us a call to do the comparison for you or this mortgage calculator and comparison service lets you easily compare interest rates, offers and cashback incentives from all of Ireland’s mortgage lenders and will quickly show you what your new monthly repayments would be.
We would recommend using a unbiases Mortgage Broker to do the market research for you. They may charge a fee, but it is worth it.

To make it easier for you to switch your mortgage, the Central Bank has introduced six new measures that lenders have to follow:

1. If you have a fixed-rate mortgage, your lender will have to tell you about any cheaper options they have available 60 days before your fixed term is due to end. 
2. If you have a variable-rate mortgage (other than a tracker) your lender will have to tell you at least once a year if you can switch to a cheaper rate with them based on how much equity is in your home i.e., your loan-to-value ratio.
3. Lenders will have to clearly explain the pros and cons of any mortgage incentives such as cashback offers.
4. Lenders must give you a comparison of how much your mortgage costs versus other options offered by your lender if you ask for one.
5. If requested, lenders must give switchers all the information they need to switch, including how long it will take.
6. And when you’re looking to switch your mortgage, lenders must give you a decision within 10 business days of receiving a completed mortgage application.

So, in a nutshell, these changes should make it a whole lot easier for mortgage holders to be able to spot and understand if, and when, they should switch lenders throughout the course of their loan period. And if you do decide to switch, the process should be a little bit easier.

Big Savings.
Someone who has a mortgage of €150,000 and is paying a 4.5% standard variable rate could save over €180 a month, or over €2,160 a year, by switching to the cheapest rate on the market. And while there are some upfront costs associated with switching mortgage provider, in many cases banks will provide cashback to those who switch or a contribution towards the legal fees.

And while switching may not be an option for everyone or indeed the right advice for everyone, particularly for those who are in negative equity, or on a tracker rate, we’d encourage anyone who’s been with their mortgage provider for a few years to review their options and see whether they could save by switching to a better deal. For more on Switching providers, click here

If you want to check the best rates available to you by switching your mortgage, you can compare interest rates and incentives across all the main lenders in Ireland with this handy Mortgage Calculator. Give it a try: it’s accurate, impartial, and free to use. You can also give us a call.

This is area for confusion for lots of people. Especially for our friends living in or working in Northern Ireland who want to buy a home and live in the Rep. of Ireland. This is very prevalent for people around the border areas of Derry and Tyrone wanting to move to Donegal, where property prices are cheaper.

Firstly, can I stress that Mortgage lending is available to cross border workers, contrary to some information being given.
Whilst lending is available there are a couple of issues for those earning Sterling to be aware of, these apply whether you currently live in the Rep. of Ireland and working in Northern Ireland or the UK or those living in Northern Ireland and wanting to move to Rep. of Ireland

If you earn in Sterling there are 2 main challenges to be aware of, these are

• There are a limited number of lenders willing to lend. Not all lenders are in the market for you.
• The lenders that will lend will allow an exchange rate but will also reduce your Sterling income by 20%. As, in the first instance the amount of lending you qualify for is based on your income, the reduction of 20% does have a major effect on the amount of lending available. Where you have 2 people earning in Sterling this can, in some case, push them out of getting lending all together. Read More

Yes, is the answer, here comes the but.

If you earn in any other currency other than Euro there are 2 main challenges to be aware of, these are

• There are a limited number of lenders willing to lend. Not all lenders are in the market for you.
• The lenders that will lend will allow an exchange rate but will also reduce your income by 20%

As, in the first instance the amount of lending you qualify for is based on your income, the reduction of 20% does have a major effect on the amount of lending available. Where you have 2 people earning in a non-Euro currency it be challenging.

Our Mortgage Service…

Your personal mortgage advisor from Advice First Financial can add significant value to your financial situation. Our mortgage service encompasses much more than form filling! Our extensive knowledge, market comparison technology and established relationships with Ireland’s mortgage lenders means you are in the best hands…

What we offer you………..Initial Discovery Meeting

• To learn about you, your requirements and financial needs
• To clearly explain the mortgage criteria applicable to you
• To reassure you by breakdown of any confusing jargon

Initial Research
Market analysis of the mortgage products available to identify a shortlist
of potential mortgage providers based on your priorities. We look at……

• Interest Rates
• Borrowing Amount
• Cash Back Offers
• The Process
• Discuss Any Challenges
• Discuss Any Challenges
• Total Costs
• Help to Buy Scheme

Application Support

• Assisting you to complete your mortgage application
• Preparing your application for approval
• Identifying, discuss & help overcome potential reasons for decline

Application Management

• Submitting your application, confirming receipt by lender
• 72hr application follow up with lender
• Dealing with any issues as they arise

Detailed Selection

• Discuss mortgage approval/terms of conditions
• Presentation of approval and up dated quotes for your selected Mortgage
• Dealing with any issues as they arise

Application Proceeding

• Help you get the property valuation completed
• Follow up to ensure all paperwork is submitted to the lender for formal approval
• Review of formal approval to ensure accuracy
• Co-ordination of your third-party interactions (lender, solicitor, estate agent, broker)
• Follow up to ensure all paperwork is submitted to the lender for cheque issue

Protecting Your Financial Health

• Completion of a financial fitness profile
• Identification of your financial needs
• Recommendations and quotations of financial needs
• Assisting you to complete your insurance applications
• Follow up to ensure all paperwork is submitted to the lender for cheque issue
• Co-ordination of underwriting requirements and documentation
• Follow up to ensure policies are issued correctly and in a timely fashion

And that’s not all….

• Unlimited phone and email access to your advisor and their support team
• Post completion service call to ensure all your requirements have been satisfied

This service is divided into 2 parts (1: Initial meeting & research, 2: Application & Loan offer). Our total fee for this comprehensive service is €945 (+23% vat) for standard residential mortgage applications. €95 payable on initial discovery meeting and initial research, €400 payable on application assessment with the balance €450 payable once an official Approval in Principle (AIP) has been secured from a lender.

For more complicated lending requirements fees will be arranged beforehand.

The fees paid at initial meeting, research and application stages are non-refundable even if the mortgage application is not successful. We will not go to application stage if we think we will not be successful. Once we have secured an offer and you elect not to proceed for any reason, we reserve the right to charge our fee for our advice and services. In the event of a lender rejecting an application from us on your behalf due to information or an unacceptable credit history not disclosed to us, we reserve the right to charge our fee.

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