The Rebuilding Ireland Home Loan is designed to enable credit worthy first-time buyers, who are unable to access a mortgage from a commercial lender, to obtain sustainable mortgage lending to purchase a new or second-hand property. The low rate of fixed interest associated with the Rebuilding Ireland Home Loan provides first-time buyers with access to mortgage finance that they may not otherwise have been able to afford at a higher interest rate.
To support prudential lending and consistency of treatment for borrowers, a Loan to Value ratio of 90% applies to the Rebuilding Ireland Home Loan as per the Central Bank's prudential lending guidelines. Therefore, in order to avail of the loan, applicants must have a deposit equivalent to 10% of the market value of the property.
Applicants must provide bank or similar statements (such as post office, credit union, etc.) for a 12-month period immediately prior to making an application, clearly showing a credible and consistent track record of savings. The cash savings should be no less than 3% of the market value of the property. Gifts are permissible up to 7% of the market value of the property, where their source is verified.
Exceptions to the above can be made where an applicant/applicants can clearly demonstrate a consistent and credible record of savings or rent payment through their bank account which at a minimum is equal to:
- In the case of a fixed rate loan, the proposed monthly loan repayment or
- In the case of a variable rate loan, the proposed stress tested monthly loan repayment.
Given the need to administer the loan in a financially prudent manner, in order to protect the financial position of both the borrower and local authorities, I have no plans to reduce these deposit requirements.