Tánaiste welcomes change to mortgage rules to help those trading down
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From: Department of Finance
- Published on: 8 April 2026
- Last updated on: 8 April 2026
Tánaiste and Minister for Finance, Simon Harris TD, welcomes today’s announcement by the Central Bank of Ireland that a change to the residential mortgage lending rules will provide greater flexibility for lenders to provide bridging finance.
Bridging finance is short-term finance which can be used to purchase a new property prior to the sale of an existing property.
The change will remove the loan-to-income limitation for borrowers who wish to obtain bridging finance. This is particularly welcome for many borrowers trading down who may be retired and have lower incomes.
Speaking today, the Tánaiste said:
“This is an important measure in our efforts to increase housing choice for older people and I commend the Central Bank and Governor Makhlouf for adopting such a sensible, pragmatic approach.
This change to the lending rules is in line with the Government’s housing plan commitment on the availability of bridging finance to support rightsizing. It is an important measure in our efforts to increase housing choice for older people and I very much welcome the development.”
The Tánaiste further stated:
“This change can facilitate the provision of additional bridging finance while maintaining the protections that the mortgage lending rules provide for the financial system and consumers.”
Notes for editors
The Government's 2025 action plan on housing supply - 'Delivering Homes, Building Communities 2025-2030' - indicates that it 'will further support older households who choose to voluntarily property 'rightsize' and advance the consideration of the availability of bridging finance to support 'rightsizing'.
Bridging finance is short-term finance which is commonly used to facilitate the purchase of a new property prior to the sale of an existing property.
The Central Bank of Ireland’s macro prudential housing loan measures are provided for in regulations made by the Central Bank under the provisions of section 48 of the Central Bank (Supervision and Enforcement Act) 2013.
These regulations set out loan to value (LTV) and loan to income (LTI) restrictions on residential mortgage credit provided to consumers by Central Bank regulated entities.
In relation to principal dwelling homes, the current LTV limit is 90% of the property's value and the LTI limit is 4 times income in respect of first-time buyers and 3.5 times income for second and subsequent buyers. These restrictions currently apply to bridging finance for residential purposes.
Lenders have a discretion to provide a certain amount of mortgage credit outside these thresholds, and that discretion can and is used to provide a certain level of bridging finance.
However, the current measures may still be impacting some lenders’ ability to offer this type of finance. The Central Bank of Ireland has decided to address this through a targeted adjustment to the lending rules.
The change, which will be provided for in regulations made by the Central Bank, will exempt bridging finance which is used to purchase a new primary house from the LTI limit. This is subject to the bridging loan being for a period of no more than 18 months and the loan being repaid on the sale of the original principal home or at the end of the loan term.
In accordance with the statutory requirements, the Central Bank has consulted the Minister for Finance on this change to the lending rules. The Minister for Finance has indicated that he supports this Central Bank decision.
While this change to the mortgage lending rules will provide enhanced flexibility to lenders in relation to the consideration of applications for bridging finance, ultimately it is a commercial decision for each lender to determine their own lending policies, such as deciding whether or not to offer a particular type credit product, and to make their own decisions on individual applications for credit.
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