Big Rush to get 90% Mortgages Before 2015

This month the Central Bank announced proposals to restrict mortgage lending to try and prevent another property price “bubble”.

LTV Restrictions
The proposal involves  telling lenders that 85% of their home loans (in value terms) must be less than 80% of the value of the home. (80% Loan to Value or LTV). Currently many lenders are dishing out mortgages of up to 92% LTV. A higher LTV means a lower deposit is required by the buyer. An 80% mortgage on a €250,000 house will require a deposit of  €50,000 – whilst a 92% mortgage would only require the buyer to find a deposit of €20,000 .

Loan to Income Ratio : (LTI)
Lenders usually lend up to a certain multiple of the buyers income(s). The proposals from the Central Bank also include restricing  lending so that no more than 20% of a lender’s mortgages can be above 3.5 times LTI.

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If the proposals become mandatory   – it will still be possible to get a mortgage of more than 80%  or more than 3.5 times income – but it will be much harder.
If you are looking for a mortgage – here are the current Best Mortgage Rates at 90% LTV

EBS 1 year fixed 3.5 %
Haven 1 year fixed 3.5 %
KBC 1 year fixed, 3.5 %
AIB 1 year fixed, 3.5 %
Bank of Ireland 1 year fixed 4.1 %
EBS Limited 3 year fixed 4.2 %
Haven Mortgages Limited 3 year fixed 4.2 %
Ulster Bank 3 year fixed 4.25 %
KBC 3 year fixed, 4.3 %
KBC 2 year fixed 4.35 %
Bank of Ireland 2 year fixed, 4.35 %
Bank of Ireland 2 year fixed, 4.35 %
EBS Variable 4.45 %
KBC Variable 4.47 %
Haven Variable 4.49 %
AIB Variable 4.49 %
Bank of Ireland Variable 4.5 %

Note : Bank Of Ireland are offering a 1% cashback deal on all mortgages for house purchases.  On a €250,000 house that would mean a lump sum of €2500. That would come in handy for furniture and other expenses. (or stamp duty).