Rebuilding Ireland Home Loan
From 1 February 2018, new Government-backed mortgages called Rebuilding Ireland Home Loans are available to first-time buyers. They are available through local authorities nationwide and can be used to buy new or second-hand properties, or to build your own home. The mortgage is a capital and interest loan which the customer repays each month by direct debit.
It is part of the Government’s Rebuilding Ireland Action Plan for Housing and Homelessness.
Who can qualify for these loans?
To qualify for a Rebuilding Ireland Home Loan, you must:
- be a first-time buyer
- be aged between 18 and 70
- be in continuous employment for a minimum of two years as a primary applicant, or one year if you are a secondary applicant
- have an annual gross income of not more than €50,000 as a single applicant or not more than €75,000 combined as joint applicants
- submit two years certified accounts if you are self-employed
- show evidence that you have been turned down for a mortgage by two banks or building societies
- have never owned residential property in or outside the Republic of Ireland
- occupy the property as your normal place of residence
- buy or build a property in the Republic of Ireland, no bigger than 175 square metres (gross internal floor area)
- buy or build a property which does not exceed the maximum market value that applies to the county it is located in
- consent to an Irish Credit Bureau check
What are the interest rates?
There are three different rates available with a Rebuilding Ireland Home Loan.
- 2% fixed for up to 25 years – this equates to an APRC of 2.02%
- 2.25% fixed for up to 30 years – this equates to an APRC of 2.27%
- 2.30% variable (subject to change) for up to 30 year – this equates to an APRC of 2.32%
As with any mortgage, with a fixed rate, the monthly repayments remain the same for the fixed rate period. During the fixed rate period you may have to pay a breakage fee if you switch to a variable rate or pay off all or part of the mortgage.
If you choose the variable rate option your monthly repayments could rise or fall over the lifetime of the mortgage. With the variable rate option you have the flexibility to make lump sum repayments, increase your repayments or make early repayments.
The rates do not include Mortgage Protection Insurance (MPI), and you would be required to have that in place. If you qualify for one of these mortgages, you will have to use the local authority collective MPI scheme and MPI will be paid monthly in addition to your mortgage repayments.
How much can you borrow?
In line with the Central Bank of Ireland rules, you can borrow up to 90% of the market value, up to a maximum purchase price of:
- €320,000 in Cork, Dublin, Galway, Kildare, Louth, Meath and Wicklow
- €250,000 in the rest of the country.
This means the amount you can actually borrow is up to €288,000 in counties Cork, Dublin, Galway, Kildare, Louth, Meath and Wicklow, and up to €225,000 in the rest of the country.
How do you apply?
You need to complete the Rebuilding Ireland Home Loan application form. You must complete all sections of the form and provide the supporting documentation as listed, which you should then submit to your local authority. Your application will be assessed and you will be advised of the decision in writing.
For more information on the Rebuilding Ireland Home Loan Scheme please visit their website.