Loan-to-Income (LTI)

Loan-to-Income (LTI) is the size of a mortgage expressed as a multiple of the borrower’s gross annual income. The Central Bank of Ireland caps mortgage lending at 4 times gross income for first-time buyers and 3.5× for second and subsequent buyers — limits introduced in 2023 to replace the previous 3.5× ceiling that had applied across the board.

For joint applications, the combined gross income of both borrowers is used. The cap applies to the loan, not the property value: a couple earning €100,000 jointly can borrow up to €400,000 under the first-time-buyer cap, regardless of how much deposit they bring.

Lenders can lend above the cap on up to 15% of new lending each year via the same exemption pool that covers LTV breaches. Exemptions tend to go to higher earners and those with strong repayment capacity, and individual lenders manage their own quota — what one bank declines, another may approve.

LTI is rarely the only binding constraint. Affordability is double-checked via the mortgage stress test and the lender’s net disposable income rules, and the deposit and target property pin the LTV at the same time. Use the mortgage affordability calculator to see the binding constraint for your numbers.