Best Mortgage in Ireland in 2019

Useful information about financial products and debt management

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.

  • What percentage of the property value can I borrow?

    Depending on their lending policy, lenders may lend anything between 80 % to 92 % of the value of the property you want to buy as long as your income and other factors make your purchase affordable. If you get a 90 % mortgage, this means that you will have to fund 10 % yourself. For example, if you can afford to buy a house worth 300.000 €, your lender may lend up to 270.000 €. You will have to fund the remaining 30.000 € yourself.

  • What documentation do I need?

    You will usually need ID documents for all parties to the mortgage - a Passport or Driving licence and a utility bill to confirm current permanent address;
    Each PAYE applicant will also need to provide their most recent (original) P60, last 3 months’ payslips and last 6 months’ bank statements;
    Self-employed applicants will need to provide their last 2 years’ certified/audited accounts and last 6 months’ business bank account statements;
    Self-build applicants will need to provide a Fixed Price contract or detailed building costings.

  • Will I be accepted for a mortgage?

    Your lender will check your credit history before they decide to give you a loan. Most lenders use the ICB (Irish Credit Bureau), which keeps files on individual borrowers. If you are turned down for a mortgage and you have never had problems repaying your loans, you may want to check your credit record.

  • Whats the difference between a variable and a fixed rate?

    A variable interest rate is subject to change, and will rise and fall over the term of the mortgage. This means that the repayment may change throughout the mortgage term. You can make additional repayments to your variable rate mortgage at any time. It’s also possible to change to a fixed rate, if required. A fixed rate mortgage loan has a rate fixed for a specified period of time. This means that the monthly repayment amount will remain the same during the fixed period.
    If you have chosen variable interest rate, note that the Bank may increase or decrease the interest rate on the loan at any time.
    You can choose from Bank's range of competitive fixed and variable rate options. These rates vary depending on the amount of your loan relative to the property value, known as Loan to Value, or LTV. Alternatively you have the option to fix a portion of your mortgage and put the rest on a variable rate.

Factors lender considers when you apply for a loan:

  • Your income - it's very common that lender asks for a proof of your employment and bank statement of your income;
  • Your credit history - when you fill out a loan application form lender usually checks your credit history. Note that if you have a bad credit history the lender may not give you the loan even though you have enough money to repay the loan;
  • Other loans - you may be refused a loan if you have other active loans;
  • The security of your job - this is important factor that indicates your capability of repaying the loan;
  • The amount of savings you have - this can help you look better and more trustworthy in the eyes of the lender.

You may be refused a mortgage based on:

  • Your income is not sufficient to repay the amount you want to borrow;
  • You have a bad credit history. This may cause a lender to turn down your mortgage application, even if you can currently afford to repay a mortgage;
  • You have too many outstanding loans or other commitments;
  • Your job is not permanent, is at risk or you have only recently started employment;
  • Your bank statements do not show that you can save or manage your money;
  • The house you want to buy has not been approved by a valuer. This could happen because the valuer thinks it is over-priced.

Annual Percentage Rate (APR)

APR – Annual Percentage Rate represents an annual cost (in %) of borrowing. It is the total cost of credit a borrower pays, expressed as an annual percentage of the amount of credit given. APR is a useful for comparing costs between different loans and different lenders. The APR takes factors such as interest rate and certain other fees and charges into account. In order to make it easier for you to compare one loan to other similar loans, lenders are required to tell you their APR before you sign an agreement.

Borrowing costs and fees

  • Administration fee: Some lenders charge this fee to cover additional services before you receive your mortgage. You may also be charged this fee for rearranging the terms of your mortgage. You may not get your money back if you do not go ahead with your mortgage application.
  • Arrangement fee: Some lenders charge a fee to arrange the loan. This can be around 0.5 % of the total cost of the mortgage.
  • Brokers' fees: Some brokers charge a fee to give you mortgage advice or to arrange your mortgage. Many brokers do not charge a fee so it's worthwhile checking in advance.
  • Estate Agents' fees: If you are selling your home, you will have to pay fees if you hire an estate agent to handle the sale. You will usually have to pay between 1 % and 2 % of the sale price or sometimes there is a flat fee.
  • Solicitors fees: Many solicitors charge a percentage normally 1 % of the mortgage amount to look after the legal aspects of your mortgage.
  • Indemnity Bond: An indemnity bond is a type of insurance policy that can be taken out by a lender when they give you a mortgage. The policy insures the lender against making a loss if they repossess your property and the house is worth less than the outstanding amount of the mortgage. It usually applies to larger mortgages where there is very little equity from the start. Many lenders waive this charge.
  • Structural survey fee: This pays for a structural survey to find out the condition of the property you want to buy. If issues were raised during the valuation of the property, or if it is very old, your lender may insist you get a structural survey. You may also want to get a survey done to satisfy yourself that there are no problems with the property.
  • Fixed rate break fee: most lenders can charge this fee is you have a fixed-rate loan and you decide to repay your loan early.
  • Late payment fees: if you miss a payment you usually have to pay late payment fee, so make sure you never miss a payment to avoid extra charges, also please note that this can also affect your credit score, which can make it harder to borrow money in the future.

If you do not keep up your repayments you may lose your home.

If you're not able to pay back loan on time:

  • Credit holidays: the delay of loan payments for a certain amount of time is called credit holidays. Credit holidays are available in some cases, such as a temporary loss of working ability or loss of job. In most cases credit holidays are granted for a period from one month to one year. This is common for longer-term loans.
  • Seek for help: if you can't find a solution with your lender, you can seek help by contacting the Money Advice and Budgeting Service. They will give you free and independent advice have to solve your money problems.

Check that the money lender is regulated:

All lenders must be registered with Central Bank of Ireland. Before borrowing make sure that your lender is regulated to avoid illegal money lenders.

You may have to pay charges if you pay off a fixed–rate loan early.

The cost of your monthly repayments may increase.

Don't accept first loan you're offered, compare various lenders to make sure you get the best possible loan offer!

If you still feel the need to take a loan you should pay attention to:

Look at your income and outgoings and think if you'll be able to pay all your bills and debts. Calculate how much you can afford to repay each month. If your budget shows that you'll have no money for extra payments then it means you can't afford to take a loan.

MoneyGuru24 is not a bank, lender, broker or product issuer. MoneyGuru24 is not owned by a financial institution but is an independent company owned by private shareholders. All information provided on MoneyGuru24 has general and informative nature. Although MoneyGuru24 covers wide range of loan products and providers, keep in mind that those are not the only options available in the market and may not be the best fit for you. We do not consider your personal circumstances and financial situation and we are not recommending any particular products. If you choose to apply for a loan product through MoneyGuru24 website you will be dealing directly with the loan provider not with MoneyGuru24. It is recommended for you to read all relevant documentation given by the loan provider before accepting any financial product offer.

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