Getting a Mortgage In Ireland

Ireland and the UK are both part of the Common Travel Area, which means that citizens from either country are welcome to live and work in the other without needing a visa or residency permit.

As a result, it’s not unusual for people living in the UK to want a mortgage to buy a property in Ireland, either because they’re an Irish citizen planning to move home at some point or a British citizen wanting a home in the EU. These mortgages aren’t as readily available as you might hope, but we’ll explain how to find one.

Can UK residents get a mortgage in Ireland?

You’ll usually need to live and work in Ireland to get an Irish mortgage. If you don’t, you’ll need to find a non-resident mortgage (regardless of where you have citizenship). The Irish mortgage market is smaller than the UK, and non-resident mortgages aren’t offered by all lenders, so there aren’t many of these available.

You are more likely to be able to get a non-resident mortgage if:

• You have a high income
• You have a large deposit
• You can demonstrate a connection to Ireland
• You’re paid in euros (most lenders won’t consider applicants paid in pounds sterling)

Rules and lending criteria

Some of the rules and lending criteria for non-resident mortgages are the same as a conventional mortgage, but others are stricter.

Here’s a summary:

How to get a mortgage in the Republic of Ireland

For the best chance of securing a non-resident mortgage, follow this three-step process.

1. Speak to an Irish mortgage specialist

With so few lenders in the market, finding one can be frustratingly difficult for foreigners and non-residents. The best option is to find a broker specialising in Irish mortgages for UK clients. If you’d like us to connect you with someone, get in touch.

2. Get an agreement in principle

It’s sensible to get a mortgage agreement in principle before you even start to look at properties. This way, you can be fairly confident that you’ll qualify and have a rough idea of how much you’ll be able to borrow before you make your full mortgage application.

3. Collate your paperwork

In the UK, many mortgage approvals are automated, but in Ireland, the system is largely manual, which is more time-consuming. You can streamline the process by anticipating and providing the documents you need in good order. Your broker will help with this and tell you what to submit, such as proof of ID, address, income, etc.

How much could you borrow?

Ireland has strict rules on how much you can borrow relative to your income. As of January 2023, first-time buyers can borrow up to four times their gross annual income, and all other buyers can borrow up to 3.5 times their income.

To borrow this amount, you’ll also need to pass your lender’s ‘stress test’, which examines your income and expenditure to assess whether you can afford the mortgage repayments. This is generally based on 12 months of bank statements.

If your income is in a currency other than euros, there will be a currency risk component to this stress test (i.e., if your currency’s value fell by 20% against the euro, would you still be able to afford the repayments?). So, you can realistically only borrow 3.5 times 80% of your income.

If you’d like to calculate how much you could borrow, try our mortgage calculator.

Lenders offering Irish mortgages

Only ten lenders currently offer Irish mortgages and only a handful offer non-resident mortgages. These include AIB and Permanent TSB, though Permanent TSB requires that your salary be paid in euros.

Bear in mind that if a lender declines your application, you may need to wait several months before reapplying to the same lender, and you might not have many other options. So, it’s sensible to apply through a broker rather than directly to avoid any errors that could jeopardise your approval.

Buy-to-let mortgages in Ireland

Since you won’t live in the property (as you’ll be in the UK), you’ll almost always need a buy-to-let mortgage. These require a large deposit (at least 30% and potentially 40-45%) and have a higher mortgage rate (around 2% higher than a conventional mortgage).

Non-resident buy-to-let mortgages in Ireland are not usually interest-only. You’ll need to make capital repayments and interest, which can make your property investment less attractive. The rental income must cover at least 120% of the monthly repayment.

Getting a holiday home mortgage

Though even rarer, one other option to buy a property in Ireland without living there is with a holiday home mortgage. It works the same way as a buy-to-let mortgage, except that you won’t be receiving a rental income on the property (and you won’t be allowed to let it).

To prove to lenders that you can afford the property on these terms, you’ll likely need an income of at least €150,000 a year, a spotless credit history, and a deposit of at least 35% of the property value.

Remortgaging in Ireland

If you buy a property in Ireland as a non-resident but later move into it, you’ll need to remortgage with a conventional mortgage. You may also need to remortgage for other reasons, such as switching to a more competitive rate or increasing your borrowing to fund home improvements.

Remortgaging in Ireland works like remortgaging in the UK, except that you’ll have fewer deals to choose from. You’ll need to check whether you’ll pay any fees for leaving your current lender before shopping around to find a new lender.

Speak to an Irish mortgage specialist.

For people hoping to buy a property in Ireland, it’s unfortunate that non-resident mortgages are not more readily available or understandable. One option is to postpone buying until you’re based in the country and have a job there so that you have access to other mortgages.

The other option is to speak to a specialist in the Irish mortgage market, who can give you expert advice tailored to your situation. We can also match you with a broker with relevant experience. Just call us on 0330 818 7026 or make a quick online enquiry.