As well as paying the mortgage, there are other costs involved in buying a home. These can be significant, so it is important to be aware of them before proceeding with the purchase.This document outlines the main costs involved.
The amount of money that you can get as a mortgage loan is governed by Central Bank lending limits, so you will need to pay the balance of the purchase price as a deposit. In general, you will need a deposit of at least 10% of the purchase price - and possibly more, depending on your situation. See Taking out a mortgage for details of these rules.
If the mortgage is from a local authority, the deposit may be as low as 3% of the purchase price.
These may include an application fee, as well as the costs of the lender's survey and searches. There may also be fees for mortgage loan costs and an indemnity bond to ensure that if the lender has to repossess the property it won't make a loss.
There is no fixed rate of charges for legal fees. Under Section 4 of the Competition Act 2002, there is no fixed percentage or level of fees. Rather, solicitors can offer competitive rates for conveyancing work - the legal work associated with buying a home. Some may charge a flat fee and some may charge a percentage of the purchase price. You can shop around to find a solicitor who will charge the lowest possible fee.
This is the fee for your own survey, which is different from the survey carried out by the lending agency. The cost can vary considerably.
The Society of Chartered Surveyors Ireland (SCSI) is the professional body for chartered surveyors.
Mortgage protection insurance is designed to pay the balance of your mortgage if you die before the loan is fully repaid. In general, lenders are legally obliged to make sure that you have adequate mortgage protection cover when you take out a home loan, although you do not have to arrange this insurance through them. Premiums vary but always reduce over the life of the loan as the amount of the loan reduces.
Local authorities run their own Local Authorities Mortgage Protection Plan and people borrowing under the Local Authorities House Purchase Loan scheme must take out insurance through this scheme.
Most lenders will also insist that you take out adequate home insurance to protect your home in the event of fire or other damage. You are not obliged to purchase home insurance from your lender.
Stamp duty is based on the value of the property transaction.
If you have a question relating to this topic you can contact the Citizens Information Phone Service on 0761 07 4000 (Monday to Friday, 9am to 8pm) or you can visit your local Citizens Information Centre.