When purchasing a property in Ireland, securing the right insurance coverage is a crucial step that protects both your investment and your financial well-being. While some insurance types are mandatory requirements from mortgage lenders, others are highly recommended for comprehensive protection. Here’s a guide to the insurance coverage you should consider when buying a house in Ireland.

Home Insurance (Buildings and Contents)

Buildings Insurance

Buildings insurance is typically a mandatory requirement from mortgage lenders before they release funds. This coverage protects the physical structure of your property including walls, roof, floors, and permanent fixtures against damage from events such as:

• Fire and smoke damage
• Flooding and water damage
• Storm damage
• Subsidence
• Vandalism
• Burst pipes
• Falling trees or branches

The coverage should be sufficient to cover the full rebuilding cost of your property, not just its market value. The rebuilding cost is often lower than the market value and can be estimated through a professional valuation.

Contents Insurance

While not mandatory, contents insurance is highly recommended to protect your personal belongings within the home. This includes:

• Furniture
• Electronics and appliances
• Clothing and jewelry
• Art and collectibles
• Other personal possessions

Many homeowners opt for a combined buildings and contents policy for convenience and often better value.

Mortgage Protection Insurance

Mortgage protection insurance is legally required in Ireland when taking out a mortgage. This is a specific type of life insurance that ensures your mortgage will be paid off if you die before the end of the mortgage term.

Features of mortgage protection insurance:

• The coverage amount decreases over time in line with your outstanding mortgage balance
• It’s typically less expensive than standard life insurance
• The policy is usually assigned to your mortgage lender
• It provides peace of mind that your family won’t be burdened with mortgage payments in the event of your death

Find out more information on the Citizen’s Information Website 

Life Insurance

Beyond mortgage protection, additional life insurance may be advisable to provide broader financial security for your dependents. This coverage can help with:

• Daily living expenses
• Education costs
• Outstanding debts
• Funeral expenses
• Replacing lost income

Income Protection

Securing income protection when buying your first home provides crucial financial safety if illness or injury prevents you from working. This insurance covers mortgage payments during unexpected health challenges, giving you peace of mind and protecting your most significant investment when you’re most vulnerable.

Additional Coverage Options

Depending on your specific circumstances, you might also consider:

• Specified Items Cover: For high-value items that exceed standard contents insurance limits
• Accidental Damage Cover: For unintentional damage to your building or contents
• Alternative Accommodation Cover: If your home becomes uninhabitable due to an insured event
• Legal Expenses Cover: For property-related legal disputes

Tips When Purchasing Insurance

1. Use a Broker: A broker will compare quotes from different providers for the best coverage and rates
2. Review policy details: Understand exactly what is and isn’t covered, including any exclusions
3. Consider excess amounts: Higher voluntary excess typically means lower premiums but more out-of-pocket expenses when claiming
4. Reassess annually: Review coverage needs and compare prices when policies come up for renewal
5. Bundle policies: Many insurers offer discounts when you purchase multiple policies with them
6. Maintain accurate valuations: Ensure building reconstruction costs and contents valuations are up to date

Conclusion

Purchasing appropriate insurance coverage is an essential part of responsible homeownership in Ireland. While mortgage protection insurance is legally required and buildings insurance is typically mandated by lenders, other types of coverage should be considered based on your individual circumstances and risk tolerance. Taking the time to understand and secure the right insurance policies provides valuable peace of mind as you embark on your homeownership journey.

Smart Mortgages can provide you with all the information you need to find the best policy possible when buying a home. Get in touch with us today

Self-employed individuals in Ireland face unique challenges when pursuing homeownership. While the dream of owning property remains achievable, the mortgage application process differs significantly from that of salaried employees. Understanding these differences and preparing accordingly can substantially improve your chances of success.

Why It’s Different for Self-Employed Applicants

Income Verification Challenges

Unlike PAYE employees who can simply provide payslips, self-employed individuals must demonstrate income stability through multiple years of accounts. Irish lenders typically require at least 2 years of consistent trading history, with some preferring to see 3+ years of accounts. The income assessment is more complex, as lenders examine:

• Notice of Assessment
• Tax returns (Form 11)
• Certified accounts
• Business bank statements
• Revenue tax clearance certificates
• Debt in the business

Different Income Calculation Methods

Irish banks generally use one of two or three approaches when calculating a self-employed person’s income:

1. Average income method: Taking the average of your last 2 years of income/ Directors remuneration
2. Latest year method: Banks are starting to put a higher weight on the most recent year.
3. Net Profit: Banks will also look at net profit of the business and depreciation

This can disadvantage self-employed individuals whose income fluctuates year to year or who efficiently minimise taxable income through legitimate business expenses.

Lower Risk Appetite from Lenders

Since the 2008 financial crisis and subsequent Central Bank of Ireland regulations, Irish lenders have maintained a more cautious approach to self-employed applicants. They often perceive self-employment as inherently riskier than regular employment, particularly in industries with irregular income patterns.

How to Successfully Apply for a Mortgage

Prepare Comprehensive Documentation

Begin gathering the following documents well in advance:

• 2 years of signed financial accounts prepared by a qualified accountant
• 2 years of tax returns (Form 11) and notice of assessments
• 6-12 months of business bank statements
• Proof of tax compliance and up-to-date tax payments
• Current contracts or client agreements demonstrating ongoing work
• Details of any upcoming projects or secured future income
• Details of business loans and leases

Consider a Mortgage Broker

Smart Mortgages has specialised knowledge of which lenders are most accommodating to self-employed applicants. They can:

• Direct you to lenders with favourable policies for self-employed individuals
• Navigate the complex documentation requirements
• Potentially access exclusive mortgage products not available directly
• Advocate on your behalf with underwriters

Demonstrate Income Stability

Take steps to show consistent income patterns:

• Maintain a regular salary payment to yourself
• Minimise dramatic fluctuations in your drawings from the business
• Consider increasing your tax declarations in the years before application
• Keep personal and business finances clearly separated

Improve Your Deposit Position

Self-employed applicants often benefit from offering larger deposits:

• Aim for at least 20% deposit (versus the minimum 10%)
• Consider the Help to Buy scheme if eligible as a first-time buyer
• Demonstrate consistent savings habits over 6+ months

Strengthen Your Credit Profile

• Regularly check your credit report with the Central Credit Register
• Ensure all debt repayments are made on time
• Reduce or eliminate short-term debts before applying
• Avoid new credit applications in the months before your mortgage application

Timing Your Application

If possible, apply after a strong financial year and when you have good visibility of future income. Some lenders may be more receptive if you can show confirmed contracts or projects extending into the future. We encourage self-employed people to submit their tax returns early when seeking a mortgage. Remember: Oct/Nov is the tax deadline for Personal Income Tax

Final Note

While securing a mortgage as a self-employed person in Ireland presents additional challenges, proper preparation and presentation of your financial situation can significantly improve your chances. By understanding the unique requirements, preparing thoroughly, and potentially working with specialists such as mortgage brokers, you can navigate the process successfully and achieve your goal of homeownership.

Green mortgages have emerged as an innovative financial product in Ireland. These eco-friendly home loans reward homeowners for energy efficiency with better interest rates. But how exactly do you qualify for one? Let’s look at everything you need to know about green mortgages in Ireland.

What Is a Green Mortgage?

A green mortgage, also known as an energy-efficient mortgage, is a special type of home loan that offers preferential interest rates to properties with high energy efficiency ratings. These mortgages represent a win-win situation: homeowners save money on both their mortgage payments and energy bills, while lenders support sustainable housing.

Qualification Requirements

The Energy Rating Threshold

The cornerstone of green mortgage qualification is your home’s Building Energy Rating (BER). To qualify, your property needs to achieve:

• A minimum rating of B3 or better
• A valid BER certificate (these are valid for 10 years from the date of issue)
• This applies to both new builds and existing homes

Required Documentation

To secure a green mortgage, you’ll need to prepare:

• A current BER certificate showing B3 or higher rating
• The detailed BER assessment report
• An advisory report outlining your home’s energy performance

Standard Mortgage Criteria

Remember that you’ll still need to meet the usual mortgage requirements:

• Sufficient income to support the loan
• Required deposit (typically 10% for first-time buyers)
• Clean credit history
• Proof of steady employment

The Benefits of Going Green

Financial Advantages

The most immediate benefit is the interest rate reduction:

• Typically 0.2% to 0.3% lower than standard mortgage rates
• This reduction applies throughout the fixed-term period
• Can lead to significant savings over the life of your mortgage

Environmental Impact

Beyond the financial benefits, green mortgages contribute to:

• Reduced carbon footprint
• Lower energy consumption
• Support for Ireland’s climate action goals

Tips for Success

1. Get your BER assessment done early in the process
2. Consider energy improvements before applying if your rating is below B3
3. Compare offers from different lenders
4. Calculate the long-term savings from both reduced interest rates and energy bills

Looking to the Future

As Ireland continues to push toward its climate goals, green mortgages are likely to become increasingly popular. They represent a practical way for homeowners to contribute to environmental sustainability while benefiting from lower mortgage costs.

Remember, investing in an energy-efficient home isn’t just good for your wallet – it’s good for the planet too.

Get in touch with Smart Mortgages for more advice on your mortgage application.

Making informed decisions about your money has become increasingly challenging. While digital tools and online resources are readily available, many individuals find that working with a financial advisor provides unique advantages that extend far beyond basic investment management. Here’s a detailed look at why partnering with a financial advisor could be one of your wisest financial decisions.

Expertise and Professional Guidance

Financial advisors bring years of training, professional certifications, and real-world experience to the table. Their expertise spans multiple areas:

• Investment management and portfolio optimisation
• Tax-efficient strategies
• Retirement planning
• Estate planning
• Risk management and insurance
• Debt management and cash flow optimisation
• Mortgage Application 

This comprehensive knowledge allows them to provide holistic advice tailored to your specific situation, rather than a one-size-fits-all approach.

Objective Decision-Making

One of the most valuable benefits of working with a financial advisor is their emotional detachment from your money. While you might make decisions based on fear, excitement, or market headlines, advisors can:

• Provide objective analysis based on data and experience
• Help you avoid common behavioural finance pitfalls
• Keep you focused on long-term goals during market volatility
• Challenge your assumptions and biases constructively

Comprehensive Financial Planning

Rather than focusing solely on investments, professional advisors take a holistic approach to your financial life:

• Creating detailed financial plans aligned with your goals
• Coordinating with other professionals (CPAs, attorneys)
• Regular review and adjustment of strategies
• Proactive identification of opportunities and risks
• Integration of all financial aspects into a cohesive strategy

Time and Stress Management

Managing your own finances can be overwhelming and time-consuming. A financial advisor can:

• Handle complex financial tasks and paperwork
• Monitor your investments and make necessary adjustments
• Keep track of important deadlines and requirements
• Provide regular updates and reports
• Free up your time for other priorities

Life Transition Navigation

Financial advisors prove particularly valuable during major life changes:

• Career transitions
• Marriage or divorce
• Starting a family
• Inheritance management
• Business succession planning
• Retirement preparation

Their experience helping others through similar situations can provide both practical guidance and emotional support.

Long-Term Accountability

Having a financial advisor creates a partnership that keeps you accountable to your goals:

• Regular check-ins and progress reviews
• Motivation to stay on track
• A professional reminder of long-term objectives
• Support in maintaining financial discipline

Access to Additional Resources

Professional advisors often provide access to:

• Sophisticated investment options
• Advanced planning tools and analytics
• Professional networks and specialists
• Educational resources and workshops
• Latest research and market insights

Cost-Benefit Consideration

While financial advisors charge fees for their services, their value often exceeds their cost through:

• Tax-efficient strategies that save money
• Improved investment returns through proper allocation
• Avoided costly mistakes
• Time saved on financial management
• Peace of mind and reduced stress

Choosing the Right Advisor

To maximise these benefits, it’s crucial to select an advisor who:

• Has appropriate credentials and experience
• Offers services aligned with your needs
• Communicate in a way that works for you
• Has a fee structure you understand and are comfortable with

Conclusion

Working with a financial advisor represents an investment in your financial future. While the immediate benefits of professional guidance and expertise are clear, the long-term value often manifests in ways that extend beyond purely financial returns. From providing objective guidance during turbulent times to helping navigate complex life transitions, a trusted financial advisor can be an invaluable partner in your journey toward financial security and success.

Useful Links

Mortgage Calculator 

Mortgage Rate Change Calculator

Extra Mortgage Payments Calculator 

Pension Calculator 

Pension Tax Relief Calculator

As the Halloween season approaches and little ghouls and goblins prepare to collect their treats, let’s explore some financial “tricks” (savvy tips) and “treats” (valuable resources) that can help secure your financial future. No tricks here – just treating you to some solid financial advice!

🎃 Tricks (Smart Financial Tips)

The Savings Spell

1. Set up automatic monthly transfers to your savings account
2. Follow the 50/30/20 rule: 50% needs, 30% wants, 20% savings

The Budget Potion

1. Track your spending using the Central Bank of Ireland’s budget planner
2. Identify and eliminate “phantom” expenses, draining your account
3. Review and cancel unused subscriptions

The Investment Cauldron

1. Diversify your portfolio to protect against market volatility
2. Consider pension contributions for tax relief
3. Set up a Regular Savings account

The Debt-Banishing Ritual

1. Prioritise high-interest debt repayment
2. Consider debt consolidation if managing multiple payments
3. Always read the fine print before taking on new credit

🍬 Treats (Valuable Resources)

Free Financial Tools

1. The SFS Mortgage Calculator
2. The SFS Mortgage Rate Change Calculator
3. The SFS Extra Mortgage Payments Calculator
4. The SFS Pension Calculator
5. The SFS Pension Tax Relief Calculator

Tax Benefits

1. Revenue.ie’s online services for tax credits and reliefs
2. Help-to-Buy scheme for first-time homebuyers
3. Pension tax relief calculator

Educational Resources

1. Central Bank’s consumer hub
2. Irish Banking Culture Board’s financial literacy resources
3. Revenue’s online guides for tax understanding

Don’t Let These Spook You!

Remember, financial planning doesn’t have to be frightening. By implementing these “tricks” and utilising these “treats,” you can create a stronger financial foundation for yourself and your family.

Need More Guidance?

Don’t let financial decisions haunt you – reach out to a qualified financial advisor who can help you navigate your specific situation. We’re here to help turn your financial fears into financial victories.