Purchase and Renovation Loan Home Loan Key Features

First Time Buyer Status

To qualify for the Local Authority Purchase and Renovation Loan, each applicant must be a First Time Buyer and neither applicant can have previously purchased or be a current owner of a residential property, with the exception of applicants qualifying under the Fresh Start Principle or those who have inherited a residential property. A Local Property Tax and Central Credit Register check will be completed at application stage.

Exception to the First Time Buyer requirement for purchasers of eligible property: You are permitted to have purchased the property which is the subject of the Local Authority Purchase and Renovation Loan application and still be eligible for the loan, in which case you would be applying for a renovation-only Local Authority Purchase and Renovation Loan. This must be the first home that you have purchased, and you must have no outstanding mortgage on the property (as the Local Authority Purchase and Renovation Loan must have the first charge).

Joint Applicant Status

For the purposes of a joint application, all applicants must qualify as first-time buyers except where an applicant is eligible under the Fresh Start principle. Joint applicants can be two or more persons who apply for a housing loan together.

Applicant Eligibility

• Proof of insufficient mortgage offer, taking into account the level of savings available to the applicant, from two regulated financial providers in the Republic of Ireland must be submitted as part of the Local Authority Purchase and Renovation Loan application. The proof must be dated within 12 months of the application, and the amount must be equal to or less than the Local Authority Purchase and Renovation Loan amount sought. Examples of acceptable evidence are:

  • A letter from a commercial lender showing the amount you requested and were offered, and/or

  • A letter from a commercial lender stating that your application is outside their lending criteria, and/or

  • An online calculator output sheet from a commercial lender's website, showing insufficient borrowing capacity for the amount sought under the  Local Authority Purchase and Renovation Loan application

  • A letter of refusal for a loan stating that your application was outside the lending criteria of the commercial lender for project specific reasons.

• Applicants are required to show the loan amount sought as part of the evidence of insufficient offers.

• Applicants must be able to satisfactorily demonstrate, with professional analysis as appropriate, that they will be able to complete the renovations to the required standard and at a cost within scheme lending criteria. The amount of financing sought must match the scheme lending criteria for the type of renovation proposed.

• Each applicant must be aged between 18 years old and 70 years old
• Applicant(s) cannot have previously purchased a residential property in or outside Ireland, with the exception of applicant(s) qualifying under the Fresh Start Principle and applicants who own the property that is the subject of the Local Authority Purchase and Renovation Loan unencumbered.
• You must occupy the property as your normal place of residence.
• The applicant must currently have a legal right to reside and work in the State. Furthermore, there are minimum periods of residence required for non-EU/EEA applicants:

  • All Irish citizens are automatically legally resident.

  • UK citizens will be regarded as being legally resident in Ireland. (This accords with the Common Travel Area requirements).

  • All EU/EEA citizens who are legally resident in the State will not be eligible to apply for a Purchase and Renovation Loan for the first three months of residence in the State. Thereafter, they will be eligible to apply.

• Non-EEA/EU citizen

  • Single/joint applications where both applicant(s) are Non-EEA/EU applicants must be legally resident in Ireland for a period of 5 years; or have leave to remain extending to potentially permit 5 years reckonable residence; or have indefinite leave to remain in the State.

  • An application from a non-EEA/EU national, who is a spouse or civil partner of the EU /EEA national, may be considered as part of a joint application for that household, provided they have a valid residence card or permanent residence card.

  • There are limited circumstances in which the right to work in Ireland is not required. Given that there is no requirement that the second applicant in a joint application must be in employment, and that therefore one earner joint applications are permissible, there is also no requirement that the second applicant in a one-earner joint application has a right to work in the State.

  •  Reckonable residence refers to residency that counts towards becoming eligible for Irish citizenship by naturalisation

• Single applicants must not be earning greater than €70,000 annual gross income.
• The combined income of joint applicants must not be greater than €85,000 annual gross income.
• Where you are married, in a civil partnership, or in an intimate and committed relationship,  one person may not apply for a Local Authority Purchase and Renovation Loan on their own. They must make any such applications together with their spouse, civil partner or partner, as the case may be.
• You must have a credible savings record of a minimum of 12 months duration immediately prior to making an application.
• You must be of good credit standing with a satisfactory credit record.

To be eligible for a Local Authority Purchase and Renovation Loan you must be:

• in continuous employment for a minimum of two years as a single applicant
• in continuous employment for a minimum of two years as the primary earner in a joint application
• An exemption to the requirement for continuous employment can be given in situations where an applicant has verifiable income from an alternative source, such as a pension from a previous employment, for the last two years (or one year if they are secondary earners in a joint application). However, this income must be of a sufficiently long-term and guaranteed nature as to provide a sustainable basis for repaying a mortgage.
• Employment can be PAYE and/or self-employment.
  • Continuous employment does not need to be permanent, but continuous in nature. This means that an applicant may be in the same employment or in more than one employment over a two year period, however the break from employment cannot have been for more than four weeks.
  • For self-employed applicants, a minimum of two full year’s accounts for that employment must be provided.
  • Multiple casual employments will not be considered eligible.

Contract Employment Income

Contract income will be considered in repayment capacity provided:

• The applicant works in an industry where contract income is regarded as common, e.g. (retail, hospitality, education, health, and financial services)
• The applicant has been on contract in a similar industry for at least the last two years or, where recently commenced a contract, has been employed in a similar industry for a minimum of the previous two years before their application date.

Where an applicant(s) contract has three or fewer months to expiry and the contract provider has given written confirmation that the contract is to be renewed.

Further evidence of contract employment may be sought by the Local Authority.

Credit Check

• You must consent to the mandatory Central Credit Register (CCR) enquiry. This consent will be used to conduct a new enquiry as part of the credit assessment process.
• An application will be classified as incomplete if all parties to the Local Authority Purchase and Renovation Loan application have not signed the CCR consent. A judgement search is completed for all named applicant(s) on an application recommended for approval.

Mortgage Protection Insurance

Mortgage Protection Insurance(MPI) is a form of insurance which pays off the outstanding balance on your mortgage should you die before the mortgage is fully repaid. The Local Authority MPI scheme is a group scheme. 

All fixed rates are exclusive of MPI which is a legal requirement of borrowing. Eligible borrowers are required to partake in the local authority collective MPI scheme. MPI is payable monthly, in addition to loan repayments. MPI is payable on the annuity loan portion of the Local Authority Purchase and Renovation Loan.

Full terms and conditions of the scheme are available from your local authority.