The Central Bank Mortgage Guidelines

As part of our series of guides on Financial Services, here you’ll find our guide to the Central Bank guidelines on lending limits. Since 2017, the Central Bank set limits on the size of housing loans made by the commercial lenders that it regulates. 

As a home buyer, this will have an impact on how much you can borrow to buy your new home.

 Our guide will help you to 

  • Understand the term ‘loan-to-income’ and what it means to you
  • Realise the importance of ‘loan-to-value’ for lenders and why it is such an important metric for them
  • See both financial concepts in action using practical examples

By applying practical stories and examples of people in the same position as you and other buyers, we’ll explain these financial issues simply and clearly, illustrating how they might impact on you.

At Sherry FitzGerald Mortgages, we’re with you every step of the way. Review our guide and if you have any queries, get in touch today.

Mortgage Calculator

Please be advised that the calculator is for indicative purposes only
Minimum Cash Deposit Required ? €0
Max First Home Scheme Available €0
Loan Amount €0
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Your Mortgage Results

Cash deposit
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Help To Buy Scheme
?
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Total deposit ?
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Monthly Repayments
in the 1st Year ?
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With the 5-year fixed rate default rate, Year 1-5 payments will remain the same. If an alternative rate is selected, repayments will vary. No First Home Scheme Service Charge is applicable in Year 1-5. From Year 6 onwards a First Home Scheme Service Charge will apply.
Monthly Repayments
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Household Salary Required
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This calculator is for illustrative and guidance purposes only.

The amount you can borrow will depend on your individual circumstances and is subject to lending criteria, terms and conditions.

The limits applied can vary so it is important to contact us to discuss your options.

For full terms, please click here.

Above illustration based on 5 year fixed rate of 4.0% (APRC 4.1%)

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Terms and Conditions

  • Illustrations are based on a 5 Year Fixed rate of 4.0% (APRC 4.1%) This rate will revert to the standard variable rate which is currently 4.5% (APRC 4.6%) after 5 years.
  • Minimum Loan Amount is €250,000.
  • No cashback available with this rate.
  • Maximum Loan to Value (LTV) 90%.
  • Central Bank deposit rules require a minimum deposit of 10% for First Time Buyers and second/subsequent buyers (not applicable for Switcher mortgages).
  • The Loan-to-Income limit restricts the amount of money you can borrow to a maximum of 4 times gross income for First Time Buyers and 3.5 times gross income for second/subsequent buyers.
  • New customer business only.
  • With the Help to Buy Scheme for First Time Buyers of new houses, a tax rebate of up to 10% (subject to an upper limit of €30,000) of the purchase price is potentially available on properties costing €500,000 or less. (Revenue Terms & Conditions apply).
  • First Time Buyers of second-hand houses will need to fund the 10% deposit themselves.
  • Rates correct as at 14.04.2023

WARNING: IF YOU DO NOT MEET THE REPAYMENTS ON YOUR LOAN, YOUR ACCOUNT WILL GO INTO ARREARS. THIS MAY AFFECT YOUR CREDIT RATING, WHICH MAY LIMIT YOUR ABILITY TO ACCESS CREDIT IN THE FUTURE.

WARNING: IF YOU DO NOT KEEP UP YOUR REPAYMENTS YOU MAY LOSE YOUR HOME.

WARNING: YOU MAY HAVE TO PAY CHARGES IF YOU PAY OFF A FIXED RATE LOAN EARLY.

WARNING: THE COST OF YOUR MONTHLY REPAYMENTS MAY INCREASE.

Mortgage Insight DAC t/a Sherry Fitzgerald Financial Services, Sherry FitzGerald Mortgages is regulated by the Central Bank of Ireland.

Terms and Conditions

  1. Illustrations are based on a 5 Year Fixed rate of 4.0% (APRC 4.1%) This rate will revert to the standard variable rate which is currently 4.5% (APRC 4.6%) after 5 years.
  2. Minimum loan amount is €250,000.
  3. No cashback available with this rate.
  4. Central Bank deposit rules require a minimum deposit of 10% for First Time Buyers and second/subsequent buyers (not applicable for Switcher mortgages).
  5. The Loan-to-Income limit restricts the amount of money you can borrow to a maximum of 4 times gross income for First Time Buyers and 3.5 times gross income for second/subsequent buyers.
  6. Maximum Loan to Value (LTV) 90%.
  7. New customer business only.
  8. With the Help to Buy Scheme for First Time Buyers of new houses, a tax rebate of up to 10% (subject to an upper limit of €30,000) of the purchase price is potentially available on properties costing €500,000 or less. (Revenue Terms & Conditions apply).
  9. The First Home Scheme will finance up to 30% of your new property, this will reduce to 20% for those who are participating in the Help to Buy Scheme.
  10. The First Home Scheme is only available for newly built houses or apartments in a private development in the Republic of Ireland.
  11. The First Home Scheme is only available for properties intended as the homebuyers Principal Private Residence.
  12. Participating Lenders do not advise or consult with homebuyers on the Terms and Conditions of the First Home Scheme. Please visit www.firsthomescheme.ie for full Terms and Conditions.
  13. Rates correct as at 14.04.2023

WARNING: Property prices can go up and down. As the equity facility is linked to the value of your home, any change in property prices will affect any partial or final redemption amounts. If property prices increase/decrease over time, the percentage equity you have to redeem will remain the same but the € amount will increase/decrease. See example in the case of a price increase below:

Customer purchases a property for €250,000, availing of €25,000 from the First Home Scheme (FHS) which means the FHS has a 10% FHS equity share in your home.

Sometime in the future you decide to buy out the FHS equity share. The home is now valued at €350,000. As the FHS equity share is unchanged at 10%, you will now need €35,000 plus any accrued service charges payable, to redeem the FHS equity share in the home.

WARNING: The First Home Scheme is not regulated by the Central Bank of Ireland and the equity product is not governed by the Central Bank and its statutory codes of conduct and/or other regulations to include the Consumer Protection Code.

Therefore, no enforceable consumer protections will apply.

WARNING: The provision of this product or service does not require licensing, authorisation, or registration with the Central Bank of Ireland and, as a result, it is not covered by the Central Bank of Ireland’s requirements designed to protect consumers or by a statutory scheme.

Mortgage Insight DAC t/a Sherry Fitzgerald Financial Services, Sherry FitzGerald Mortgages is regulated by the Central Bank of Ireland.

Help to Buy Scheme rebate

If you are a first time buyer who has paid income tax or Dirt Tax in Ireland in the past 4 years you can apply to claim back up to €30,000 of the purchase price of a new home, with the Help to Buy Scheme How to apply and details of revenue eligibility requirements. This calculator will show the maximum rebate obtainable as an indication. If you use the Help to Buy Scheme the maximum First Home Scheme share available is reduced to 20% of the purchase price.

Minimum Cash Deposit

A booking deposit will be required to reserve a new home. This will usually be €5,000 – €7,000. The Help to Buy Scheme allowance can be up to €30,000. Each applicant will be advised of their own allowance.

First Home Scheme

The First Home Scheme is a government affordable housing scheme based on the equity share model. The scheme can be used to finance up to 30% of your purchase of a newly built property. There are property price ceilings set across Ireland, by local authority area.

Home buyers will receive funds from a participating bank in return for the First Home Scheme taking a percentage ownership in the property purchased. This is known as an equity share. There is no charge for the first 5 years.

For more information on the Shared Equity Scheme, please visit here. If you are using the FHS, you must have senior mortgage approval with the Participating Mortgage Lenders at the maximum 4 x Loan to Income (LTI)

First Time Buyer

As a non-First Time Buyer, you may still be eligible to use the First Home Scheme. Please click here to check if you are eligible, or contact our Financial Service team for further advice.

Loan Amount Less Shared Equity

This is the loan amount less the Shared Equity of 20% and the deposit of 10% which can include the Help to Buy Scheme.

County Council

Each region across Ireland will have a Shared Equity Scheme price cap applied. By entering your local County Council we are able to help calculate your estimated results for your region. For more on the regional price caps, please visit here.

Total deposit

10% of the purchase price that must be paid on signing of contracts (less any booking deposit already paid).

Help To Buy Scheme

If you are a first time buyer who has paid income tax or Dirt Tax in Ireland in the past 4 years you can apply to claim back up to 10% of the purchase price of a new home, up to a maximum of €30,000, with the Help to Buy Scheme How to apply and details of revenue eligibility requirements. This calculator will show the maximum rebate obtainable as an illustration.

If you use the Help to Buy Scheme the maximum First Home Scheme share available is reduced to 20% of the purchase price.

MONTHLY REPAYMENTS IN THE 1ST YEAR

First Home Scheme Service Charges apply from the beginning of the sixth year of ownership of a property, if the equity share is still in place.

Monthly Repayments in Year 6 Onwards

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Download our Central Bank Guidelines explainer

Read about how the Central Bank set limits on the size of housing loans made by the commercial lenders that it regulates. And how it impacts you.

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