Deposit Required
The amount of the deposit required largely depends on what type of buyer you are, and what type of property you are buying.
First Time Buyers (FTBs)
FTBs require a deposit of 10% of the purchase price (note: banks are allowed to have up to 5% of annual mortgage lending to FTBs above 90% loan to value (LTV), but in practice no lender currently offers mortgages above 90% of the purchase price). However, don’t forget that you will also need to budget 1% for stamp duty, and around €2,500 for legal fees. For example, if you are buying a property for €300,000, then you will need to have a total of €35,500 available to cover the deposit and associated costs.
If you are unsure whether you are classified as a first time buyer, or if you are planning a joint application where one borrower is a first time buyer, please refer to our related article, Am I a First Time Buyer?
Second and Subsequent Buyers (SSBs)
SSBs require a deposit of 20% of the purchase price (plus stamp duty and legal fees). However, banks are allowed to lend up to 90% of the purchase price to SSBs, with each lender subject to a quota of 20% of annual mortgage lending above 80% LTV. Such exceptions are subject to availability and to each lender’s own criteria.
Non-Resident Mortgages
It is possible for non-resident Irish borrowers to get a mortgage for a holiday home, investment property, or a family home which they intend to move home to in the following couple of years. That said, the options are extremely limited. Generally, the maximum LTV is 65%, i.e. a deposit of at least 35% is required. Beyond that, the lending criteria are very strict. One such example is that applicants earning in a non-euro currency will have their discounted by 20% to allow for possible adverse currency fluctuations. Contact us for more details, and we can quickly advise whether you may be eligible for a non-resident mortgage.
Investment Mortgages
Investment or buy-to-let mortgages require a larger deposit. Investors must contribute a deposit of 30% of the purchase price. Again, lenders are allowed to make some exceptions, whereby a maximum of 10% of buy-to-let mortgages can be above 70% LTV. However, in practice, the banks currently limit the maximum loan to 70% LTV.
About MMPI
MMPI is an award-winning Irish broker offering you expert mortgage advice. Our experienced and qualified team will advise you on the best options suited to your specific circumstances.
