Traditional saving approach
This might seem obvious, but saving is a crucial way to accumulate your deposit. However, with high rents and other expenses, it can be challenging. There’s no problem with starting small and developing a good saving habit. It also demonstrates to the bank that you can consistently save each month. Even if you receive the entire deposit as a gift, banks will still want to see that you can manage your finances independently and afford monthly mortgage payments. Setting up a savings account and arranging a direct debit on the same day each month is easy. Create a budget and keep track of your expenses. This will help you identify areas where you can make simple cutbacks that can have long-term benefits.
REMEMBER: Try to avoid withdrawing funds from your savings account. Banks view this unfavourably and it may delay your approval. You can “lock” your account, requiring a 30-day notice to the bank for any cash withdrawals.
Utilize the Help-to-Buy scheme
The Help-to-Buy (HTB) incentive is a scheme designed for first-time property buyers, assisting them with the deposit required to purchase or construct a new house or apartment. The HTB scheme provides a refund of Income Tax paid in Ireland over the four years prior to your application. This can increase your deposit by up to €30,000, significantly expediting your journey to owning a new home.
Opt for a mortgage with a cashback offer
Some individuals are fortunate enough to obtain short-term loans from family or friends while saving for a mortgage. A cashback deal can be a helpful way to promptly repay them after closing the sale. Although cashback mortgages may have slightly higher rates, you can always switch to another deal after a few years.
Claim a tax refund
The average tax refund for applicants ranges from €900 to €1,100. While this might not cover the full deposit, every little bit helps! Additionally, you can explore tax relief opportunities introduced during the pandemic for other expenses like heating, broadband, and electricity.
