How to Get a Mortgage in Ireland as an Expat: A Step-by-Step Guide

How to Get a Mortgage in Ireland as an Expat: A Step-by-Step Guide

Table of Contents

The front of a house that an expat would consider buying in Ireland

Welcome to our detailed guide on how to get a mortgage in Ireland for Expats. If you’re envisioning life in a quaint countryside cottage or a lively city apartment, this guide will clarify the mortgage process for you. We break down everything from various mortgage types and rates to the specific requirements for expats.

Step by step, we’ll guide you through the process and share essential tips to avoid common mistakes. With the right support, your path to owning a house in Ireland can run more smoothly than you think. All it takes is the right knowledge, from the right sources. To help, our team is here to provide you with their insights on what you need to consider before buying real estate in Ireland as an expat.

Introduction to Mortgages

What Is a Mortgage?

A mortgage is a loan specifically for purchasing or maintaining property, such as a house or land. In Ireland, when you get a mortgage, you agree to repay the lender over time through regular payments that include both the original loan amount (principal) and the interest. The property you buy serves as security for the loan.

Origins of the Word “Mortgage”

The word ‘mortgage’ originates from the Old French ‘mort gage’, meaning ‘dead pledge’. It refers to the agreement ending (‘dying’) when the loan is paid off or if repayments fail.

The Difference Between a Mortgage and a Loan

A loan is a broader term for any money borrowed that needs to be repaid with interest. A mortgage, however, is specifically for buying property. If mortgage repayments are not met, the lender may take back the property (repossession).

Information For Expats

How Does a Mortgage Work in Ireland for Expats?

For expats in Ireland, getting a mortgage might include additional steps like establishing your creditworthiness and potentially providing a larger deposit. It’s important to understand these unique requirements, as they can affect your mortgage application and the options available to you. Read on to find out more specific details about this.

Can Expats/Foreign Residents Get a Mortgage in Ireland?

Yes, expats and foreign residents can indeed get a mortgage in Ireland. If you are legally residing in Ireland, you are eligible for a mortgage, whether you’re an EU/EEA citizen or a non-EU/EEA citizen with a Stamp 1, Stamp 1G, or Stamp 4 visa. To secure a home loan, expats typically must demonstrate that they have been residing and working in Ireland for a minimum period, often around one year, which helps in establishing creditworthiness in the Irish property market.

How long will an expat have to be employed in Ireland before they can apply for a mortgage?

The answer to this depends on the nature of work that you’re employed in. For someone who is say an accountant or consultant, effectively, someone who can work from home, remotely, they can probably keep the job they had in the country they left. It’ll be easier for this type of person to get a mortgage as they can keep their employment up.

In certain situations, people who were once employees of a company become a contractor to that same company – they sometimes do that because the company has an office in Ireland or has some sort of umbrella organisation. So instead of giving up that employment completely, they just change their status. When that happens, generally, mortgage lenders and any brokers you work with would look for one year worth of payslips to prove your income or if a partial year, payslips and tax returns. 

EmployeesContractorsSelf-Employed
1 year of payslipsPayslips and/or Tax returns for 1-2 yearsAs much evidence as you can gather to prove reliable income
Waiting time: 6 monthsWaiting time: 6-12 months2-3 years.
Overview table of wait times for different employee types

If you’re self-employed abroad, like in the UK or Australia, it’s tough to use that income for a mortgage in Ireland. Lenders usually don’t accept it, except for contractors with just one or two clients, like an IT consultant for say, a single bank. If you own a company abroad and live in Ireland, that income won’t count either, i.e. you’re taking a wage from the company that’s abroad. Bottom line is: for self-employed people in Ireland to get a mortgage, you need to be paying taxes in Ireland and have an established business there, with a steady income for about two years, for banks to consider it.

Depiction of a person working from abroad using a laptop

Can I apply from abroad?

It’s crucial to get early advice if you’re thinking of buying a home from abroad. People often wrongly assume they can buy just because their friends did, but many factors like high childcare costs, high rents, being self-employed or having insufficient savings can affect this. A quick chat with a mortgage broker can clarify if you can apply from abroad or need to wait until you’re back home. But never just assume you qualify for an expat mortgage; each case is unique. For example, a high-earning employee was declined a mortgage because his credit report showed multiple directorships abroad, which the bank saw as a risk, even though he was a top earner. 

However, most applicants, around 70%, apply for a mortgage while still living and working abroad. This way, they have a property ready in Ireland when they return, avoiding the need to rent or live with family. The goal for many is to secure a property before moving back to Ireland.

Tip: In Ireland, the Property Services Regulatory Authority (PSRA) exists to regulate property services like auctioneers, estate agents, and letting agents. But, caution is still advised so that as an expat, you can be sure you’re treated fairly throughout the property purchase process.

Types of Mortgages in Ireland 

There are several types of mortgages in Ireland, including fixed-rate mortgages, where the interest rate remains constant for a set period, and variable-rate mortgages, where the rate can fluctuate. The cost of your mortgage will depend on the type of mortgage, its term (such as 25 or 30 years), and the interest rate. As an expat, you might find that your options and rates differ, so it’s crucial to discuss these with your lender and/or mortgage advisor or broker.

What Types of Mortgages are Available in Ireland? 

There are various types of mortgages available in Ireland, catering to different needs and circumstances:

  • Repayment and Interest-Only Mortgages:
    • These affect how the loan is paid back. With a repayment mortgage, you pay off both the mortgage and interest each month, aiming for a zero balance at the end of the term. An interest-only mortgage involves paying just the interest monthly, with a lump sum due at the end.
  • Cashback Mortgages:
    • Popular among first-time buyers, this type offers a cash lump sum once your home loan is drawn down, useful for covering moving expenses like legal fees.
  • Green Mortgages:
    • These discounted mortgages are available for energy-efficient homes with a Building Energy Rating (BER) of B3 or better, open to first-time buyers, switchers, movers, and self-builders.
  • Buy-to-Let Mortgages:
    • Designed for property investors or landlords, these mortgages often offer options like interest-only or a mix of repayment and interest-only loans.
  • Self-Build Mortgages:
    • With this type, you draw down funds in stages as your build progresses, paying interest only on the amount borrowed.

How can I be sure I’ll get a mortgage as an expat?

The first thing you need to do is get an approval in principle. This is made up of a number of distinct steps:

  • Proof of Funds Requirement: 
    • Selling agents often require proof that you can cover the deposit. For example, for a €500,000 property with a €350,000 mortgage (70% finance), they may want evidence of €150,000 in savings.
  • Confirming Deposit and Savings: 
    • A mortgage advisor can confirm over the phone or email that the balance of funds for the deposit is in place. This could be from savings or a gift from parents. Applications are not submitted without confirming this.
  • Establishing Affordability: 
    • Affordability for expats is shown through a regular savings pattern before moving to Ireland. Banks stress test the desired loan amount at 6% over the chosen term (maximum 25 years). For instance, if the stress test repayment is €2,000, applicants must demonstrate they can save this amount monthly for six months leading up to the mortgage application. Affordability is a crucial factor to being able to get a mortgage as an expat. If you move back to Ireland, before getting a mortgage, don’t stop saving!
  • Savings Pattern: 
    • It’s important to regularly save a consistent amount (e.g., €3,000 monthly) and not touch these savings. Having multiple savings or share accounts with frequent transfers can make it difficult to demonstrate clear affordability, so stick with one if you can.
  • Consideration of Other Expenses: 
    • Rents, childcare costs, and changes in work status (like part-time work due to childcare responsibilities) are also factored into the maximum borrowing potential. In places like Singapore or some parts of the Middle East, rents are exceptionally high. Even if you have a high salary, substantial rent payments can reduce the mortgage amount you qualify for because rent is seen as outgoing from your account.
  • Application Timeline and Requirements: 
    • If you don’t show a clear savings pattern, you may need to save consistently for six months before reapplying. 
  • Effect of Family Size and Income Earners: 
    • The number of children affects affordability calculations. In cases where there’s only one income earner with children, the earner must have a significantly high salary to qualify. Having two incomes, regardless of the second income’s size, can greatly increase borrowing potential.
  • Seek Advice:
    • Talk to someone who knows this landscape, get good advice, don’t assume that you’ll be approved for a mortgage because you have savings and were approved for a mortgage in another country. If you deal with a bank directly, as opposed to a mortgage advisor or broker, they may make you go through a 3-4 month process of filling in paperwork, providing documentation, and virtual meetings and you may still be told no. So save yourself time and hassle by seeking out the right advice first – this will save you time and headaches in the long run. The right advisor will be able to tell you in a matter of minutes if you’d qualify for a mortgage. We recommend speaking with Paul from Top Mortgages.

We’ve recorded a podcast about getting a mortgage as an expat – check it out here.

Understanding Mortgage Rates in Ireland

Mortgage Rates explained

Variable Rates:

Variable rates can change, offering flexibility to repay more, extend, or switch lenders without penalties. Types of variable rates include standard variable rates (linked to the European Central Bank rates but subject to lender’s discretion), tracker variable rates (directly follow European Central Bank rates), capped rates (variable but with a maximum cap), discounted rates (temporary incentives for new customers), and Loan-to-Value (LTV) rates (dependent on the mortgage amount relative to the property value).

Fixed Rates:

Fixed rates lock in your interest and monthly repayments for a set period, providing stability but less flexibility. Penalties may apply for early repayment, switching lenders, or re-mortgaging. Long-term fixed rates are usually more expensive due to the certainty they provide.

Split Rates:

These combine the benefits of both variable and fixed rates, with part of the mortgage on a variable rate and the other on a fixed rate.

Choosing the Right Rate:

Your choice between fixed and variable rates depends on your preference for stability versus flexibility, future financial plans, and willingness to take risks with interest rate fluctuations.

Do expats pay different mortgage rates?

Expats get the same mortgage interest rates as residents in Ireland. There’s no higher rate for expats. If you purchase a house from abroad, once you return to Ireland and start living here, the rate doesn’t change. The only thing you need to do is update your correspondence address. So, whether you’re an expat or a resident, the interest rate on your mortgage remains the same.

Fixed vs Variable Mortgage Rates: Pros and Cons

Variable Rates

ProsFlexibility: You can adjust your monthly repayments, pay off your mortgage early, or switch lenders without facing penalties.
Potential Benefits from ECB Rate Changes: If the European Central Bank (ECB) rates fall, and your lender responds accordingly, you could benefit from reduced interest rates.
ConsLack of Predictability: With variable rates, your monthly payments could increase if interest rates rise, which could affect your long-term financial planning.
Financial Vulnerability: The uncertainty in rate changes over a long mortgage term (20-30 years) could put you in a vulnerable financial position.
Pros and Cons of Variable Rate mortgages

Fixed Rates

ProsPredictability and Stability: Fixed rates offer certainty in your monthly repayments, which can be crucial for budgeting and financial planning, especially for families and long-term financial commitments.
Protection from Rate Increases: With a fixed rate, you’re safeguarded against potential increases in interest rates over the term of your mortgage.
ConsMissing Out on Lower Rates: If interest rates fall, you won’t benefit from reduced payments, potentially paying more than necessary.
Penalties for Changes: There could be fees for overpaying, switching lenders, or paying off your mortgage early. However, some lenders now allow up to a 10% overpayment annually without penalties.
Commitment: Fixed rates are typically more suited for those who plan to stay in their property for the duration of the fixed term. Switching properties or lenders could incur penalties.
Pros and Cons of Fixed Rate mortgages

Deciding Between Fixed and Variable Rates

The decision between fixed and variable rates will largely depend on your individual circumstances, financial goals, and comfort with risk. Consider:

  • Your need for financial stability and predictability.
  • Future financial plans that might require flexibility in mortgage payments.
  • The likelihood of wanting to switch mortgages or move homes in the foreseeable future.

Trend Towards Fixed-Rate Mortgages in Ireland

  • The shift towards fixed-rate mortgages in Ireland aligns with trends in the rest of Europe. The Central Bank of Ireland reports a significant increase in fixed-rate mortgage uptake, signalling a preference for financial predictability among homeowners.
  • This trend reflects a growing desire for financial stability, particularly in times of economic uncertainty.
A married couple considering what mortgage they'll avail of before moving to Ireland

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Preparing for a mortgage as an expat

How to Prepare for a Mortgage before coming to Ireland

  • Save for a Deposit:
    • When looking for a house, real estate agents often require proof that you can cover the deposit. For example, for a €500,000 property with a €350,000 mortgage (70% finance), they may want evidence of €150,000 in savings.
  • Check Your Credit Record:
    • Your credit history affects your borrowing capacity. Check your credit report with agencies like Experian before lenders do. Your credit history plays a significant role in mortgage approval. In Ireland, lenders assess your credit rating by examining your current and past loans, along with your repayment history over the last five years. This includes monitoring for any missed payments or unsettled debts. However, a blemish on your credit rating doesn’t automatically disqualify you from obtaining a mortgage. Lenders may consider the reasons behind any missed repayments. 
    • If you’re an expat, especially from Australia or the Middle East, planning to buy a home, it’s key to get your credit report before leaving. 
    • In Australia, use Equifax, Experian, or Illion. In the UK, it’s Experian or TransUnion. 
    • You can also get credit reports in some Middle Eastern countries, but not all. It’s really important for Middle Eastern expats to get their credit report and proof of earnings from the past three years before leaving. Once you leave the Middle East, getting these documents becomes nearly impossible. This highlights the importance of planning ahead and getting the right advice early on. If you wait until you’re back home, you might find you can’t get the necessary documents for your mortgage application.
  • Get Your Finances in Order:
    • Pay all bills on time, set a budget, save regularly, and reduce your credit usage. Avoid new credit obligations and, if possible, don’t change jobs or let gambling transactions show on your account. These things will show up on your credit reports, so be conscious of this in the years leading up to a move away.
  • Get Your Documents Together:
    • You’ll need to provide proof of identity, address, six months of bank statements, credit card statements, payslips, and employment details. If you’re self-employed, you’ll need financial accounts, tax clearance, and business bank statements. 

Schedule time with a broker to help guide you through the process.

  • You’ll need to start this before you move to Ireland. They’ll be able to tell you quickly whether you’ll be eligible for a mortgage.
  • If you’re abroad and don’t qualify for a mortgage, a mortgage advisor can identify the issues quickly. They’ll advise that you can’t get a mortgage while overseas due to specific reasons and suggest waiting until you return home. 
  • Then before coming back, contact a mortgage advisor a month or two in advance. They’ll guide you on which documents to bring, like credit reports, to avoid the hassle of trying to obtain them from abroad later.
  • Once home, and you’re ready to start the process again, the advisor can estimate your maximum borrowing potential based on your qualifications and income. They’ll need to know your living arrangements, like staying with family or renting, to provide accurate advice. This preparation means that when you start working, you’re on track. The goal is to ensure that when you apply for a mortgage six months later, you get approved on the first try, saving time and avoiding complications.

How to Prepare for a Mortgage when in Ireland

Payslips and banking activity:

  • Banks in Ireland require a work history in Ireland, including payslips and bank activity, before considering a mortgage application. Even if you’re highly qualified and paid in euros, banks like Bank of Ireland and Permanent TSB usually require you to be back in Ireland for six months. This rule applies even if you return to work with the same employer.

Find Out How Much You Can Borrow:

  • Understand the Loan to Value (LTV) and Loan to Income (LTI) limits set by the Central Bank of Ireland. Don’t forget to include costs like stamp duty and solicitor fees in your total cost calculations.

Government Support and Schemes for Expats

If you’re an expat who has been residing in Ireland for several years, you may qualify for government support, like the Help to Buy Scheme. But, while these opportunities can significantly impact your purchasing power, it’s also important not to make assumptions about your entitlements.

This is where speaking to a dedicated tax and financial advisor can make all the difference. 

For example, the right advisor in Ireland can assist you with:

  • Scheme eligibility: Understanding whether you meet the eligibility criteria for government schemes and initiatives is vital for getting ahead of any savings you can make on your property purchase. A tax or financial advisory service in Ireland will be able to evaluate your situation and match you to potential schemes. 
  • Tax implications: The right team of expat tax advisors can assess your unique situation and help you navigate your liabilities as an expat, helping you make more informed decisions. From stamp duty advice to tax savings you can put towards your booking deposit, an Irish tax adviser can help you stay compliant while also capitalising on financial opportunities.
  • Alternative support programs: Beyond the Help to Buy Scheme, there might be other support programs available to expats in Ireland. A professional advisor can inform you about additional opportunities that align with your financial goals.

Note: Stamp duty is a tax paid in Ireland when property ownership is transferred. Stamp duty applies to residential properties like houses, apartments, or sites with agreement to build. While exemptions to this tax exist, it’s always best to consult a tax expert before proceeding.

Shopping for a Mortgage Lender in Ireland

If you haven’t picked up this already, the best advice we can give you before you look for a mortgage, a house, or even thinking about looking for a mortgage is to seek advice from a mortgage specialist or broker. They are uniquely positioned to advise you on what you’ll need to qualify, the savings habits you’ll need to be in, the amount of deposit you’ll need and various other factors. However, we wanted to provide some general information of things to consider when you are shopping around for a mortgage so you know what to be aware of.

How to shop for a mortgage lender

  • Consider Which Type of Mortgage Is Right for You:
    • Evaluate different mortgage types, such as fixed-rate and variable-rate mortgages, and understand their implications. Remember, fixed-rate mortgages offer the same interest rate throughout the loan term, while variable-rate mortgages adjust based on market conditions. Be very conscious however that you will be availing of an expat mortgage so some of the mortgages that you see on offer may not apply to you.
  • Reach Out To and Compare Mortgage Lenders:
    • Explore various lending options, including banks, credit unions, and mortgage brokers. Obtain personalised Loan Estimates from multiple lenders to compare interest rates, fees, and overall costs. Use this information to negotiate better terms.
  • Consider Using a Mortgage Broker:
    • A mortgage broker can provide access to a wider range of products and help optimise your credit report. They can be particularly helpful if you have a complex financial situation, such as irregular income or a history of bad credit. As an expat, we highly recommend working with a broker. They make a difficult task a lot easier. There are a certain amount of restrictions and hoops you have to jump through to get a mortgage in Ireland. Working with a broker who already knows the hoops is your best bet to make it easy and simple. We recommend speaking with Paul from Top Mortgages – paul@topmortgages.ie or reach out to us to make an introduction.

Mistakes to avoid 

Common Mortgage Application Mistakes to Avoid

  • Failing to Meet Bill Payments:
    • Missing bill payments, especially in the six months leading up to your mortgage application, can negatively impact your credit history. Ensure you have sufficient funds to cover all direct debits and bills.
  • Accumulating Debt:
    • Avoid taking on new debt ahead of your application. Instead, focus on clearing existing debts, particularly on credit cards, to improve your credit score and debt-to-income ratio.
  • Taking Out New Loans:
    • New loans can affect how much you’re eligible to borrow as they reduce your net disposable income (NDI). Remember, your mortgage repayments should not exceed 35% of your NDI.
  • Failing to Show Repayment Ability:
    • Demonstrate your ability to meet regular repayments, either through rent instalments or consistent savings, ideally exceeding your future mortgage repayments by at least 10%.
  • Insufficient Savings:
    • Save for not just the deposit (10% for first-time buyers, 20% for others) but also for other costs like solicitor’s fees, stamp duty, and surveyor’s reports.
  • Dipping into Savings:
    • Avoid using your savings for non-essential expenses until after the mortgage process is complete.
  • Job Changes:
    • Stability in employment is crucial. Banks generally require several months of permanent employment, or two years’ worth of business accounts for the self-employed.
  • Delaying Mortgage Protection:
    • Arrange for mortgage protection insurance early in the process to avoid delays. This may require a medical examination or access to medical records.
  • Not Researching Lenders:
    • Compare interest rates, terms, and perks like cashback offers from various lenders to find the best deal for your needs and budget.

Mortgage Protection in Ireland

What is Mortgage Protection?

Mortgage protection is a type of insurance policy specifically designed to cover your mortgage in the event of your death during the mortgage term. It ensures that your mortgage loan is paid off, providing security for both you and your lender.

Do I need mortgage protection?

In Ireland, having mortgage protection insurance is generally a mandatory requirement when taking out a mortgage. This is to ensure that the loan amount (sum assured) is secured in case of the borrower’s untimely death.

Any exceptions to this?

There are certain situations where mortgage protection may not be required by lenders:

  • The property is not a primary family residence (e.g., buy-to-let properties).
  • Inability to obtain insurance or only at a significantly higher premium.
  • Borrowers over the age of 50 at mortgage approval.
  • Existing life insurance policies covering the mortgage amount.

Flexibility in Choosing Providers:

While lenders may offer mortgage protection insurance, borrowers are not obligated to purchase it from them. Shopping around can often lead to better deals and more tailored coverage.

Consequences of Non-Payment:

Failure to maintain mortgage protection insurance payments can breach mortgage terms, risking property repossession and loss of housing rights for the family.

Coverage and Policy Details

Standard Coverage:

  • Accidental Death: Provides interim coverage during the application process.
  • Guaranteed Insurability: Allows for coverage increase following significant life events without additional medical evidence.
  • Terminal Illness Cover: Offers early payout in cases of terminal illness diagnosis with limited life expectancy.
  • Children’s Life Cover: Provides a set amount if a child covered under the policy dies within the term.

Types of Policyholders:

  • Single cover for individual mortgage holders.
  • Joint or dual life policies for mortgages with multiple holders, offering either a single payout on the first death (joint) or potential payouts on the death of each policyholder (dual life).

Types of Mortgage Protection Insurance

  • Reducing Term Cover:
    • Suitable for repayment mortgages, where the cover decreases in line with the remaining mortgage balance.
  • Level Term Cover:
    • Ideal for interest-only mortgages, maintaining consistent coverage throughout the term.

Cost Factors

  • Premiums depend on age, health, mortgage amount, policy type, term length, and chosen provider.
  • Additional features or add-ons, such as serious illness cover, can increase the cost.

Add-On Options

  • Specified Illness Cover: Provides a payout on the diagnosis of certain illnesses.
  • Mortgage Insurance Conversion Cover: Allows conversion into a life insurance policy without further medical assessment.

Life Insurance vs. Mortgage Protection

While mortgage protection is specifically tied to covering your mortgage, life insurance offers broader beneficiary benefits and isn’t limited to mortgage debt. Having both policies can provide comprehensive coverage for various needs.

What do all these mortgage terms mean?

Understanding mortgage terms and conditions is essential for anyone entering the home buying process. Here’s a breakdown of important mortgage-related terms to help you navigate through this journey:

  • Interest Rates:
    • The cost of borrowing money from a lender, expressed as a percentage of the principal loan amount.
  • Fixed-Interest Rate:
    • An interest rate that remains constant for a predetermined period during the loan term.
  • Standard Variable Rate:
    • An interest rate that fluctuates over time, potentially increasing or decreasing based on various factors.
  • Capital/Principal:
    • The original sum borrowed from the lender, not including interest or other fees.
  • Cost of Credit:
    • The total amount repaid by the end of the mortgage, including the borrowed amount, interest, and any additional fees.
  • Annual Percentage Rate (APR):
    • Represents the total cost of the loan annually, including interest and fees. The lower the APR, the lower the overall cost.
  • Approval in Principle (AIP):
    • A lender’s statement of how much they would potentially lend you, based on preliminary information. It’s not a guarantee of mortgage approval.
  • Deposit:
    • The initial payment made towards the property’s cost, typically the difference between the property cost and the loan amount.
  • Direct Debit Mandate (DDM):
    • Authorization for the bank to pay the lender the monthly mortgage repayments from your account.
  • Equity:
    • The difference between the property’s market value and the outstanding mortgage balance.
  • Loan-to-Value (LTV):
    • The ratio of the mortgage amount to the property’s value, expressed as a percentage.
  • Building Energy Rating (BER):
    • A measure of a home’s energy efficiency, with A1 being the most efficient. Some lenders offer green mortgages for energy-efficient homes.
  • First-Time Buyer:
    • An individual who has never owned property or land before.
  • Guarantor:
    • A third party who agrees to cover mortgage repayments if the borrower is unable to do so.
  • Broker:
    • A professional who assists in finding and applying for mortgages, offering advice on various options.
  • Collateral:
    • The borrower’s property that serves as security for the loan.
  • Title Deeds:
    • Legal documents proving property ownership.
  • Freehold vs. Leasehold:
    • Different types of property ownership. Freehold is indefinite ownership of property and land, whereas leasehold is ownership for a fixed term, often requiring ground rent.
  • Deferred Start:
    • An option to delay mortgage repayments for a set period, increasing the overall loan cost.
  • Payment Break (Moratorium):
    • A temporary halt in mortgage payments, useful during financial difficulties but may increase the total cost due to accrued interest.
  • Letter of Offer:
    • A document from the lender outlining the terms of the mortgage offer.
  • Mortgage Protection Insurance:
    • A policy that pays off your mortgage in case of your death during the mortgage term. It is usually a requirement for obtaining a mortgage.
  • Valuation:
    • An assessment of the property’s market value, often required by the lender and paid for by the borrower.
  • Drawdown:
    • The final stage where the mortgage funds are released to the seller.
  • Arrears:
    • A situation where mortgage payments are overdue, which can negatively impact your credit history.

Understanding these terms can greatly assist in making informed decisions throughout the mortgage process, from application to finalisation.

As we wrap up our guide on mortgages for expats in Ireland, we hope you now feel better equipped and confident to take this journey on. Remember, securing a mortgage in a new country can be a complex process, but with the right information and preparation, it’s entirely achievable. Take the time to understand each step, gather your documents meticulously, and don’t hesitate to seek professional advice when needed. Whether you’re just starting to explore your options or are ready to take the leap, keep in mind that every step brings you closer to your dream home in Ireland. Good luck, and may your Irish home-buying adventure be as fulfilling and enchanting as the Emerald Isle itself!

Getting a mortgage is just one facet of your move to Ireland – download our free ebook to get advice and tips on various other considerations including healthcare, childcare, education and more.

FAQ

What Residency status do expats need to get a mortgage in Ireland?

If you are legally resident in Ireland, subject to certain criteria, you are eligible to get a mortgage in Ireland. This applies to EU/EEA citizens, as well as non-EU/EEA citizens with a Stamp 1, Stamp 1G or Stamp 4.

Do expats need a deposit to get a mortgage?

For Expats, securing a mortgage can come with a few obstacles, so it is important for borrowers to understand what will be required of them throughout the process. Typically, the bank will lend up to 70% of the house purchase price and the buyer will need to have saved the remaining 30%.

We’re married with two kids. My husband or wife commutes back to our home country from Ireland for work. How are we affected?

In cases where a married couple has the husband working abroad (like in the UK or Middle East) and the wife is a homemaker in Ireland, it’s considered a mortgage foreign exchange scenario. This is different from an expat mortgage. The husband might work abroad for weeks and return home for shorter periods. In these situations, costs like flights and accommodation need to be considered. It’s important to know whether the employer covers these expenses or if the applicant does. Ultimately, you should factor this into the conversations that you have with an advisor.

What’s the length of term I can get for my mortgage as an expat?

The longest term you can get is 25 years as an expat.

If I work with a broker, who pays their fees?

Most brokers are free to work with as the lender pays their fees. However, we recommend you clarify this with the broker you decide to work with.

Can mortgages include renovation costs?

The answer to this one is maybe. It will depend on the type of mortgage you get and what you agree with your lender. If you’re interested in learning more about the specifics, there’s a great overview here: https://mortgage123.ie/house-renovations/

Can mortgage payments go up?

Yes. If your mortgage is based on a variable interest rate and the interest rate goes up, then you will pay more in your monthly repayments. Read more on that topic here: https://mabs.ie/blogs/interest-rate-rises-what-does-this-mean-for-me/

How is mortgage interest calculated?

On the most basic level, this is calculated by taking the balance of what you owe and multiplying that by the annual interest rate (APR). So, if you owe €100,000 and your interest rate is 4% – then you’d pay €4,000 / 12 = €333.33 per month in interest. The rest of your payment would be off the principal loan amount. 

How are mortgage payments calculated?

This is similar to how the interest is calculated – your payment is made up of a fixed amount that you agreed to pay to the bank. Within this fixed amount, the bank will deduct the interest payment (i.e. the cost of borrowing that money from your lender) with the rest being left over to pay off the actual loan amount that you used to pay for your house.

Can I pay my mortgage early?

This is another ‘it depends’ answer. In this case, it will depend on whether your bank lets you do this based on the type of mortgage you have. Generally, if you’re on a fixed rate mortgage, and you pay your mortgage early, you will have to pay penalties. If your mortgage is not fixed, then you may be able to pay it off early. As always, you’re best to consult with your mortgage advisor or mortgage lender and seek the correct advice.

Resources

Mortgage protectionhttps://www.aviva.ie/protection/mortgage-protection/
https://www.zurich.ie/life-insurance/mortgage-protection/
https://www.vhi.ie/mortgageprotection
https://www.irishlife.ie/life-insurance/mortgage-protection/
https://www.bonkers.ie/compare-mortgage-protection-insurance
Mortgage Providershttps://personalbanking.bankofireland.com/borrow/mortgages/
https://aib.ie/our-products/mortgages
https://www.havenmortgages.ie/
Mortgage Comparison: https://www.bonkers.ie/compare-mortgages/lenders/
Further reading on comparison of rates: https://www.bonkers.ie/blog/mortgages/which-bank-has-the-best-mortgage-rates-for-firsttime-buyers/
Expat Mortgage Advisershttps://www.topmortgages.ie/mortgages/expat-mortgage/
https://mortgage123.ie/an-expat-looking-for-a-property-at-home/
https://mymortgages.ie/overseas-buyers/
Mortgage Calculatorshttps://aib.ie/our-products/mortgages/mortgage-calculator
https://www.sherryfitz.ie/mortgage-calculator
Property Websiteshttps://www.daft.ie/
https://www.property.ie/
https://www.myhome.ie/
https://findahome.ie/

DISCLAIMER: The material in this article is for general information purposes only and does not constitute legal or taxation advice. Specific legal, financial, investment and taxation advice should be sought before acting or refraining from acting. All information and taxation rules are subject to change without notice. Expats Taxes accept no liability whatsoever for any action taken in reliance on the information in this article or any of the articles in our blog series. Expat Taxes Limited does not provide financial planning, investment, mortgage advice and this article is provided only for general informational purposes. We are not authorised/licensed to provide financial advice and this article should not be considered to constitute advice of this type in any respect.

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