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Need To know: First Home Scheme

SYS Group Mortgage Manager Helen Slattery takes the topic of the First Home Scheme and dissects it for you in this informative article. As your mortgage brokers, we can help you avail of this scheme.

First Home Scheme Ireland – What is it?

The First Home Scheme (FHS) is a shared equity scheme, designed to help bridge the gap for first-time buyers and eligible homebuyers between their deposit & mortgage, and the price of their new home.  The FHS have now confirmed that the Tenant Home Purchase Scheme is available to eligible tenants who have received a notice of Termination and are looking to purchase the home they are currently renting.  As a result, the FHS is now available to eligible first-time buyers looking to buy an existing property they are currently renting.

The First Home Scheme is funded and supported by the Government of Ireland (Department of Housing, Local Government and Heritage) in partnership with Participating Lenders – AIB / EBS / Haven / PTSB / BOI

The FHS could help you meet the shortfall to assist you to buy your home by taking a share of the ownership in your property. The percentage ownership that the FHS holds in your home is known as an equity share. To further assist in the process, we recommend examining SYS Group’s financial planning services.

Who is Eligible to Avail of the First Home Scheme

  • The applicant must be over 18 years of age,
  • A first-time buyer mortgage applicant, is defined as:
    • A person who hasn’t previously purchased and/or built a dwelling in Ireland to live in and
    • Doesn’t own or is not beneficially entitled to an estate, or has interest in a residence in Ireland and –
  • The applicant(s) must have the right to reside in Ireland
  • You may also be eligible if you have previously purchased or built a property in the Republic of Ireland:
  • With a spouse, civil partner, or partner, and that relationship has ended. You must not retain a beneficial interest in the previous property, or
  • If you have sold (or divested of) that property as part of a personal insolvency or bankruptcy arrangement, or other legal process as a consequence of insolvency.

To find the best mortgages for first time buyers, contact Helen Slattery @ helen@sysmortgages.ie

First Home Scheme Rules 

  • The shared equity scheme is available for newly built houses or apartments in a private development in Ireland.
  • This scheme is not available for self-builds.
  • The building must be the principal private residence
  • The scheme can fund up to 30% of the purchase price of the property. It is reduced to 20% if the applicant is availing of the Help to Buy Scheme (HTB). Details of HTB can be found on Revenue’s website.
  • This scheme is subject to property purchase price ceilings based on the local authority area in which the property is located. Property price ceilings per local authority area apply to both houses and apartments. This means that you cannot avail of the FHS if the cost of your property is above this amount. In particular, local authority areas, the ceiling for houses and apartments is different. More information on these limits can be found on firsthomescheme.ie 
  • The minimum equity share is 2.5% of the property purchase price, or €10,000, whichever is higher.
  • No fees or charges are applied to the equity facility for the first five years. At the start of your sixth year of ownership, if you have not fully redeemed the equity share, a service charge will begin to accrue against your account. (See section on service charges below)

To Qualify for the First Home Scheme

  • You must have Mortgage Approval with a Participating Lender
  • Be borrowing the maximum mortgage amount available to you from one of the Participating Lenders (up to 4 x income)
  • The applicant cannot be availing of an exception with a participating lender
  • Must have minimum deposit of 10% of the property purchase price

PLEASE NOTE: Your income is not assessed by First Home Scheme as part of the FHS eligibility criteria.

Starting the Process

The bank cannot confirm if a customer will be eligible for the scheme and The Tenant Home Purchase scheme. The applicant must contact their Local Authority Housing agent and The FHS Directly.

Customers can contact the First Home Scheme on 0818 275 662 (lines are open between 9.00am and 5.30pm Monday to Friday excluding Bank Holidays).

  1. Once you have a Mortgage Approval with a participating lender and if you find that you still have a shortfall in funds, you can visit firsthomescheme.ie and use the FHS eligibility calculator to calculate the minimum and maximum support you could potentially qualify for through the FHS.
  2. You don’t need to have a specific property in mind at this stage, however you’ll need to know the local authority area of where you hope to purchase. (Please see interactive map on the FHS website)
  3. You can register and apply for the FHS through the customer portal. The supporting documentation required to submit your FHS application includes:
    • A copy of your AIP (Approval in Principle) letter from a participating lender
    • Photo ID for each applicant, valid for at least another six months
    • Current address verification (dated in the last six months) for each applicant.
  4. Your application and documentation will be reviewed and, if approved, you’ll receive an Eligibility Certificate.
  5. It is important to understand that the Eligibility Certificate is not an official offer from the FHS, but an indicative estimate of the minimum and maximum amount of equity you qualify for based on the information you provided.
  6. If your FHS application is approved, you’ll receive a copy of your Customer Contract for the equity facility. The Customer Contract is the formal legal contract between you and the FHS. This will also be sent to your solicitor.
  7. If you wish to make changes to applicant names or property details, you can contact the FHS via the customer portal. Alternatively, you can call the FHS customer contact centre on 0818 275 662
  8. The signed Customer Contract, and all declarations and forms should be returned to the FHS by your solicitor to complete the application. The FHS will then release funds to your solicitor’s account, and your solicitor can finalise the property purchase on your behalf in parallel with the mortgage process.

Service Charges

A service charge will be applied to your account from the start of year six as payment for services related to the provision, maintenance, and servicing of the equity facility. Service charges are calculated at the following rates per annum:

Service Charge Rates

YEARS 0-50%
YEARS 6 – 151.75%
YEARS 16-292.15%
YEARS 30+2.85%

The service charge rates are fixed for the life of the equity facility. Service charges accrue daily and are applied to your account monthly in arrears, so your monthly service charge may vary given the number of days in the month. FHS will contact you before the service charge is due to be applied to the equity facility to confirm your preferred payment option.

Payment options You can choose whether you want to:

  • Pay the service charge by monthly Direct Debit, Electronic Funds Transfer (EFT), or via a debit card facility
  • Pay the full annual service charge or make 12 monthly instalments
  • Pay a reduced amount if you can’t afford the full monthly service charge
  • Defer payment until another date

There is no additional cost associated with deferring the payment of the service charge, however, the service charge will continue to accrue against your equity facility and will need to be paid in full at a later date.

PLEASE NOTE: By paying the service charge you won’t reduce the equity share taken in your property. The equity share can only be reduced by redeeming part or all of the equity share.

Redemption of the equity share

You can redeem all or part of the equity share at any time, although there is no obligation to do so unless a mandatory redemption event occurs.

When you make a redemption payment, you’ll need to tell us where the redemption funds came from

for all redemptions you will need an up-to-date property valuation. This is performed by an independent, FHS Approved Valuer. You will need to pay the fee for the valuation, which remains valid for 12 months from the date set out on the valuation.

If you choose to make a full redemption, that is to buy back all of the equity share, you will also need to pay back any accrued service charges.

Partial redemption payment

If you choose to redeem part of the equity share, the partial redemption payment must be at least 5% of the original amount provided by the FHS. Up to two separate redemption payments can be made against the equity share in any 12-month period


Property prices can go up and down. As the equity facility is linked to the value of your home, any change in property prices will affect any partial or final redemption amounts. If property prices increase/ decrease over time, the percentage equity you have to redeem will remain the same but the € amount will increase/decrease. See example in the case of a price increase below: Customer purchases a property for €250,000, availing of €25,000 from the First Home Scheme (FHS) which means the FHS has a 10% FHS equity share in your home. Sometime in the future you decide to buy out the FHS equity share. The home is now valued at €350,000. As the FHS equity share is unchanged at 10%, you will now need €35,000 plus any accrued service charges payable, to redeem the FHS equity share in the home

Mandatory Redemption

The following events require you to redeem the full equity share, as well as service charges that have accrued against the equity facility:

  • The property is sold
  • The property is no longer your Principal Private Residence
  • You move or switch your mortgage to a non-Participating Lender
  • If you die (or, in the case of joint applications, the last applicant dies)

WARNING: The First Home Scheme is not regulated by the Central Bank of Ireland. Visit FHS.ie or download the First Home Scheme FAQs.

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