End of Interest Relief, How long to draw down?

[mcbert]

Hey,

I see Noonan mentioned the mortgage interest relief announced in last budget would be ending at end of the year. If you get in before the end of the year, it will last until 2019. Fair enough.

But he also said "prospective purchasers should make sure to factor in the time required between purchase and mortgage drawdown in order to qualify for mortgage interest relief".

I didn't realise there was any practical difference between time of purchase and time of drawdown. What is the difference? And how much time would you need to leave to make sure you qualify?

Anyone? Any ideas?

Thanks.

 

[ryaner]

When you agree a price with the EA, it can take 4-12 weeks before contracts are fully finalised and the cheque is issued. You then have to have made one repayment for the TRS to trigger but the way around this is to pay 1 euro the day the cheque is drawn down.

 

[leonmahon]

It goes Sale Agreed -> Contracts Exchanged -> Drawdown and move in.

Ours was a fairly straightforward sale and it still took 10-12 weeks. Lots of little annoying bits and pieces adding up. Leave yourselves as much time as possible.

 

[SadBob]

Ours took about 15 weeks from sale agreed last year and in theory was the simplest of purchases - no chain and house we were buying was vacant. Don't under estimate the potential for incompetence by the parties involved. Also as far as I'm aware mortgage interest relief will finish end 2017 - you don't get 7 years from 2012.

http://www.citizensinformation.ie/en/housing/owning_a_home/buying_a_home/mortgage_interest_relief.html

 

[Troy McClure]

Hey,

I see Noonan mentioned the mortgage interest relief announced in last budget would be ending at end of the year. If you get in before the end of the year, it will last until 2019. Fair enough.

But he also said "prospective purchasers should make sure to factor in the time required between purchase and mortgage drawdown in order to qualify for mortgage interest relief".

I didn't realise there was any practical difference between time of purchase and time of drawdown. What is the difference? And how much time would you need to leave to make sure you qualify?

Anyone? Any ideas?

Thanks.

To pick on two points. First I believe all TRS ends in 2017 not 2019. Secondly, and there is some debate around this, you qualify for TRS from your first repayment date and not drawdown date. There are lots of threads here on this debate. I called the TRS helpline myself and was told two different things.
When you apply for TRS it asks for first repayment date on application. In the event if you drawdown in Dec 2012 your first repayment would not be until Jan 2013, so then you would lose out.
I posed this question last year anticipating it's end, and was told this was the case by one revenue person and not by another. I asked for it in writing by the 'not' person and got a letter saying it was.
I would not take a chance and allow for a repayment date within 2012.
You could put throught a manual repayment in case for back up. I would call revenue if I were you as perhaps they are more clear on this now. Get it in writing if I am wrong and this situation may occur for you at years end.

 

[mcbert]

Thats great info. Thanks everyone. 15 weeks! Didn't expect that. ok, so 15 weeks to 1st December means sale agreed with EA by 18 August. So that leaves about 6 weeks to go a bank, view some houses, negotiate/agree a price. Eeekk!