1st time buyer definition - Central bank contradicting Revenue?

xboxdad

Hi everyone,

Can someone please tell me which of these contradicting definitions is taken into account when taking out a mortgage & applying for HTB?

Central bank says:

"A first time buyer is defined as a borrower to whom no housing loan has ever before been advanced."

https://www.centralbank.ie/press-area/press-releases/Documents/FAQ%20%E2%80%93%20New%20regulations%20on%20residential%20mortgage%20lending.pdf

Revenue says:

"The first-time buyer must not have either individually or jointly with any other person (directly or indirectly), previously purchased or built a house or apartment."

http://www.revenue.ie/en/tax/it/reliefs/htb/help-to-buy-faqs.pdf

According to Central bank's definition, I'd be a first time buyer. According to Revenue I'm not. (bought a property abroad for cash earlier)

Thank you.

Michael D Not Higgins

The Central Bank regulates the mortgage lending industry and the amounts lenders can advance to borrowers. The government for the purposes of Help to Buy use the Revenue definition which is a broader scope but in effect the Central Bank actually use a "first time borrower" definition while Revenue use "first time buyer".

The two regimes are separate and distinct and indeed you qualify for one but not the other.

xboxdad

Michael D Not Higgins wrote: »

The Central Bank regulates the mortgage lending industry and the amounts lenders can advance to borrowers. The government for the purposes of Help to Buy use the Revenue definition which is a broader scope but in effect the Central Bank actually use a "first time borrower" definition while Revenue use "first time buyer".

The two regimes are separate and distinct and indeed you qualify for one but not the other.

Thank you! (very confused )

pilly

When it comes to the HTB scheme Revenue have their conditions and they will stick to them no matter what.

How do they know if someone has property abroad I wonder though?

Michael D Not Higgins

pilly wrote: »

When it comes to the HTB scheme Revenue have their conditions and they will stick to them no matter what.

How do they know if someone has property abroad I wonder though?

Fraudulent declaration followed by an audit and severe penalties with interest.

pilly

Michael D Not Higgins wrote: »

Fraudulent declaration followed by an audit and severe penalties with interest.

I didn't suggest anything untoward Michael. There is no need for the passive aggressive post.

I was merely wondering aloud how they know these things. I mean we have a lot of non-nationals living here now. How does revenue check if they have any property abroad.

It was merely a question, not a suggestion.

Michael D Not Higgins

I was just answering the question. There's no register they can just look up to see if you've bought a property somewhere else in the world. Sure, governments can hardly get their own databases to talk to each other. The way they'd find out is an audit which uncovers the fraud.

jimmycrackcorm

pilly wrote:

I was merely wondering aloud how they know these things. I mean we have a lot of non-nationals living here now. How does revenue check if they have any property abroad.

They don't. But if you got audited and regular payments popped up for a foreign mortgage then the walls would come tumbling down.

xboxdad

jimmycrackcorm wrote: »

They don't. But if you got audited and regular payments popped up for a foreign mortgage then the walls would come tumbling down.

As for my own situation, it's my wife who did own a property abroad, but she doesn't have it anymore. Still, I don't think I'd have the nerves to declare she never had anything on her name... So I was trying to find out about this contradiction in definitions instead

pilly

xboxdad wrote: »

As for my own situation, it's my wife who did own a property abroad, but she doesn't have it anymore. Still, I don't think I'd have the nerves to declare she never had anything on her name... So I was trying to find out about this contradiction in definitions instead

Are you not a FTB then in your own right? If the foreign property had nothing whatsoever to do with you?

If you were married at the time though this would be hard to believe.

Michael D Not Higgins

pilly wrote: »

Are you not a FTB then in your own right? If the foreign property had nothing whatsoever to do with you?

If you were married at the time though this would be hard to believe.

"Where more than one individual is involved in purchasing or building a new home, all of the individuals must be first-time buyers."

xboxdad

pilly wrote: »

Are you not a FTB then in your own right? If the foreign property had nothing whatsoever to do with you?

If you were married at the time though this would be hard to believe.

Banks will enforce joint applications when you're married, so I can't be a FTB despite the fact that I never had a property on my name personally.
We were married, but we bought that one for cash (much cheaper than property in Ireland) so no loan was involved and no one had the right to enforce us to do it jointly. So it's just a bit unfortunate that I need to do a joint application with her now, but that's the rules anyways

pilly

xboxdad wrote:

Banks will enforce joint applications when you're married, so I can't be a FTB despite the fact that I never had a property on my name personally. We were married, but we bought that one for cash (much cheaper than property in Ireland) so no loan was involved and no one had the right to enforce us to do it jointly. So it's just a bit unfortunate that I need to do a joint application with her now, but that's the rules anyways

I suppose the advantage to it though is your not restricted to new builds and so not in competition with other FTB'S.

xboxdad

It's a good thing I started this thread and studied the definition of the "1st time buyer" before applying for mortgage.

Maybe these people "forgot" to mention they once had a property in another country?

Revenue wants their money back:
http://www.eveningecho.ie/nationalnews/Number-of-first-time-buyers-who-qualified-for-Help-To-Buy-Scheme-ordered-to-pay-money-back-93254942-11db-4a79-9cc1-9614dd68a3ea-ds

GingerLily

I heard about this - was this a genuine mistake by the applicants or people gaming the system?

xboxdad

GingerLily wrote: »

I heard about this - was this a genuine mistake by the applicants or people gaming the system?

They didn't say exactly, but Revenue doesn't seem to take it lightly as they want to charge 110 EUR per month if the applicants don't pay up within 3 months. So I thought it's more about ppl gaming the system.

D3V!L

If a person purchased a house, paid a deposit but never completed the sale and drew down on the mortgage would they be classed as a first time buyer still ?

GingerLily

D3V!L wrote: »

If a person purchased a house, paid a deposit but never completed the sale and drew down on the mortgage would they be classed as a first time buyer still ?

To who?

whippet

We always had a bit of an ‘Shure it’ll be alright’ attitude to filling in official documentation in this country and for many receiving this demand letter I’d wager they were somewhat economical with the truth at application time.

Back before the 2005 bubble it was all about getting a good broker who could inflate your application to get monstrous mortgages and lobbing a couple of new cars on the 100% ..... so the notion that people would chance their arm for a freebie isn’t outlandish.

And revenue don’t mess about when they want their pound of flesh back !!

D3V!L

GingerLily wrote: »

To who?

Paid a deposit to the builder. I presume thats what you mean.

izzyflusky

xboxdad wrote: »

It's a good thing I started this thread and studied the definition of the "1st time buyer" before applying for mortgage.

Maybe these people "forgot" to mention they once had a property in another country?

Revenue wants their money back:
http://www.eveningecho.ie/nationalnews/Number-of-first-time-buyers-who-qualified-for-Help-To-Buy-Scheme-ordered-to-pay-money-back-93254942-11db-4a79-9cc1-9614dd68a3ea-ds

It looks like people were claiming for contracts exchanged before july 2016

https://www.irishtimes.com/business/personal-finance/revenue-chases-handful-of-help-to-buy-applicants-after-audit-1.3437761

xboxdad

izzyflusky wrote: »

It looks like people were claiming for contracts exchanged before july 2016

https://www.irishtimes.com/business/personal-finance/revenue-chases-handful-of-help-to-buy-applicants-after-audit-1.3437761

That's similarly bold I'd say...

izzyflusky

Oh I don't condone it. Simply clarifying as I was curious too and someone else mentioned this article in another thread.

GingerLily

D3V!L wrote: »

GingerLily wrote: »

To who?

Paid a deposit to the builder. I presume thats what you mean.

Is this a hypothetical?
Because I'm curious how this would actually pan out regularless of first time buyer status.

And I meant to a bank or to revenue, because to a bank if you drew down ya mortgage I assume they'd classify you as a non-FTB but if you never had ownership maybe you would be a FTB to revenue.

SNNUS

D3V!L wrote: »

If a person purchased a house, paid a deposit but never completed the sale and drew down on the mortgage would they be classed as a first time buyer still ?

I was purchasing a property years ago, the mortgage was drawn down for a week or two before it was sent back to the bank after the solicitor found issues with the vendor owing money to management company. The sale did not go through and contracts not signed so I am still a first time buyer as I never put pen to paper on a contract.

Once you sign the contract then you have purchased a property in your own name.

D3V!L

GingerLily wrote: »

Is this a hypothetical?
Because I'm curious how this would actually pan out regularless of first time buyer status.

And I meant to a bank or to revenue, because to a bank if you drew down ya mortgage I assume they'd classify you as a non-FTB but if you never had ownership maybe you would be a FTB to revenue.

Not hypothetical. The mortgage wasn't drawn down as per my original post.

Aoife_82

Hi,

what about someone that applied as FTB for the mortgage (but owns a property abroad for which wasn't required a loan, as the OP) and that didn't apply for HTB or DIRT relief?

I think that the bank definition allows that and the Revenue doesn't mind because no relief was claimed (the stamp duty is 1% in any case), so, unless there is something specific with the solicitor contract, I don't think there is anything wrong with that... or not?

Thanks,

Aoife

awec

Aoife_82 wrote: »

Hi,

what about someone that applied as FTB for the mortgage (but owns a property abroad for which wasn't required a loan, as the OP) and that didn't apply for HTB or DIRT relief?

I think that the bank definition allows that and the Revenue doesn't mind because no relief was claimed (the stamp duty is 1% in any case), so, unless there is something specific with the solicitor contract, I don't think there is anything wrong with that... or not?

Thanks,

Aoife

If you own a property anywhere you don’t qualify for HTB. How you paid for it, which taxes or reliefs you did or did not get is irrelevant.

Aoife_82

Infact I was saying that the bank will still consider the FTB in that situation, but it wouldn't be possible to apply for HTB. Am I wrong?