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Buy To Let Bank Restrictions

  • 02-01-2021 01:18AM
    #1
    [Deleted User]
    Posts: 57 ✭✭


    Hi Folks,

    Just wondering does anyone know do banks have a general restriction in place that people can only get a Buy-To-Let mortgage from them if there salary is +€50k? Seems to be the rule on banks I have called so far, this is despite my good savings record and having the extra deposit of 30% in the bank. I didnt experience these walls when I got my First Time Buyer Mortgage. (Note I am still paying back the First Time Buyer mortgage but this is mainly covered from tenants under the Rent a Room Scheme.) Cheers.


Comments

  • #2
    DubCount
    Registered Users, Registered Users 2 Posts: 1,158 ✭✭✭DubCount


    The main restriction is the maximum LTV of 70% which you seem to meet. The issue after that is capacity to repay. Consider what happens if you have a long void period or a tenant not paying rent on a buy2let property. Could someone with a salary of less than 50k sustain repayments of their own home mortgage and a buy2let mortgage and still afford to live? The bank rules may be doing you a favour here and protecting you from yourself.

    IMHO, leveraged buy2let in Ireland is simply too risky for an individual investor. A constant stream of anti-landlord legislation just increases risk over time. Congratulations on saving a large amount of money. Speak to a financial advisor on options to invest that money that provides better returns for less risk. Are your pension contributions maximised for example.


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