To make it clear what you can borrow if you want to move home, the Central Bank set out some rules for second time buyers, which cover home movers:
The maximum LTV is 80%, this is the percentage of the property’s value you can borrow. This means you’ll need a 20% deposit.
Lenders have some flexibility to go above this limit in some cases.
Each year, they can give an allowance of 20% of the value of mortgages to second or subsequent buyers.
You can borrow up to 3.5 times your gross salary with a mortgage. If you’re getting a mortgage with someone, it’s 3.5 times your combined salaries.
Again, lenders may be able to increase this limit for you. They can give an allowance of 10% of the value of mortgages to second buyers in a year.
To be considered for additional funds or a higher LTV, you’ll need to be a low risk borrower, this will require a good credit history and a good level of income.
These are the basic steps for getting a home mover mortgage and moving to a new home:
To find the right mortgage for you, there are a few things to consider:
If you owe more on your mortgage than the property is worth, this often prevents you from being able to move.
However, some lenders may let you transfer the negative equity over to your new mortgage if you meet other criteria e.g. a good repayment record for the past two years.
You should speak to your lender, a mortgage broker (mortgage credit intermediary), or an independent financial advisor for advice.
If you have a tracker mortgage and you don’t want to give it up, you may be able to continue on that type of mortgage when you move home.
Although trackers are not available to new customers, some lenders offer follow on tracker mortgages for existing tracker customers.
This means staying with the same lender and the same or similar product terms as before.
Check with your lender whether they offer a tracker mortgage for home movers.
It is possible to move if you have a fixed rate mortgage but you may have to pay an early redemption charge (ERC), which could cost thousands of euro.
To avoid paying fees, you may be able to:
Porting over your mortgage involves staying with the same lender and reapplying for a mortgage with them. This may mean missing out on a better interest rate with another lender.
If your circumstances have changed since you last applied, or you wish to borrow more, you may not be eligible to port your mortgage over.
You’ll need to weigh up your options and the costs involved in each. For example paying an ERC and switching your mortgage to a better rate, or porting your mortgage over and paying a higher interest rate.
There are several fees to pay that can’t be added to your mortgage, including:
To help you move your furniture, appliances, and other belongings, you may need to pay for removals or temporary storage.
Once you’ve moved, depending on the condition of the property and your budget, you may wish to redecorate it, or do some more substantial renovations.