New Mortgage Loan Regulations, 90% Mortgages for First Time Buyers
Today the Central Bank announced new regulations in the Irish residential mortgage market.
The new regulations include new maximum mortgage sizes, including the headline lending rate of 90% mortgages for first-time buyers.
For the first time, those buying property valued up to €220,000, a maximum LTV of 90% will apply.
For mortgages over €220,000 a 90% limit will apply only on the first €220,000 value, and 80% beyond this.
Principal dwelling house mortgage loans will be subject to a limit of 3.5 times loan to gross income.
Banks will be able to lend up to 80% of the property value to non first-time buyers.
The measures will be built into legislation in the next few weeks.
Buy to Let mortgages have been made subject to a 70% LTV. This limit can be exceeded by 10% in certain circumstances during an annual period.
Central Bank Governor Patrick Honohan said: “These measures will reduce potential financial vulnerabilities for both borrowers and the wider economy and will help ensure a stable and well-functioning mortgage lending market.”
Main image by William Murphy @ Flickr.