Are you on the hunt for a home for the first time but not sure where to start? We understand that buying a new home as a first time buyer can indeed feel overwhelming, and that the information you need to take on board at this point may seem daunting but with careful planning and research, you can navigate the process successfully.
Here is a selection of the most Frequently Asked Questions we receive daily from our First Time Buyer Community to help you get started:
- Can you use the First Home Scheme (FHS) and Help to Buy Scheme (HTB) together or should you pick one over the other?
Yes, you can use both schemes together. If you use both schemes you can get up to 20% of the purchase price on the FHS. If you use only the FHS you can get up to 30% of the purchase price using the FHS.
- I have just moved to/returned home to Ireland, how soon can I apply for a mortgage?
Most lenders prefer to lend to mortgage applicants who have been working in Ireland for at least 12 months. You also need to have passed the probation period in your employment.
- If I already own a home in another country, do I qualify as a First Time Buyer in Ireland?
No.
- How much of a deposit should I have saved before I apply for a mortgage?
As a first time buyer, you need to have 10% of the purchase price as a deposit. For example: If you were purchasing a property priced at 360k you would need to have a deposit of €36k saved. However, you can use your HTB rebate as part of that. So, if you get the full €30k from HTB through revenue, you will only need €6k of your savings to make up the €36k deposit amount. You would also need to factor in solicitor fees and stamp duty of approx. €4-5€k.
- Can I get a personal loan to use as a deposit?
No.
- Can I use a gift as a deposit?
Yes, you can usually use a gift from friends or family for your deposit, but there are some rules that you will need to be aware of. You will also need a letter confirming it is a gift from the person giving you the money.
- How long does it take to get Approval in Principle (AIP)?
Once you have submitted all the requested documents, it can take 3 days to 3 weeks to get approval depending on the lender you choose.
- How much can I borrow?
For most first time buyers, the maximum you can borrow will be 4.0 times your annual gross household income. The absolute maximum you can borrow under Central bank limits is 4.5 times your annual gross household income, however lenders are only allowed to go this high on 20% of mortgages. These are known as exceptions.
- How do I repay the equity share (First Home Scheme)?
You can buy back the equity share in your home at any time. But you do not have to. You can buy back the full equity share in one payment or pay it back partially as you can afford to. However, the minimum amount you can pay back is 5% of the original equity amount and you can only make 2 partial payments a year.
- How do I qualify as a fresh start applicant on The First Home Scheme?
You are a ‘fresh start’ applicant if you previously owned a home, but you no longer have a financial interest in it because you are now divorced, separated, or your relationship has ended or you have gone through personal insolvency or bankruptcy. If you are buying or building the property with someone else, they must also be a first-time buyer or fresh start applicant.
Please submit any further questions to Leah & Nicole from our First-Time Buyer expert team. They are always happy to help you out!
E: FTBspecialist@sherryfitz.ie
T: +01 667 1888
Visit our First Time Buyer Hub here.
