First Home Scheme Ireland – Everything You Need to Know

Buying a home can be difficult, even when you have saved a deposit and qualify for a mortgage. Sometimes, your deposit and mortgage are still not enough to cover the full price of the property.

The First Home Scheme Ireland is designed to help with this problem. It may provide some of the remaining money needed to purchase or build a qualifying home.

However, the First Home Scheme is not free money. In return for providing funding, the scheme receives a percentage ownership interest in the property. It is important to know exactly how the scheme works.

This guide explains how the First Home Scheme works, who qualifies, how much support is available, and what happens after you purchase your home.

What Is The First Home Scheme?

The First Home Scheme, also known as FHS, is a government-supported programme for people who can almost afford a home but are still a bit short of the full purchase price.

Essentially:

The scheme may provide the missing money if your deposit and mortgage are not enough.

For example, imagine a home costs €400,000 and you have:

• A €40,000 deposit
• Mortgage approval for €320,000

Together, this gives you €360,000.

However, the home costs €400,000, meaning you are €40,000 short.

The FHS may provide the remaining €40,000 needed to complete the purchase. In return, the scheme receives a percentage ownership interest in the property.

What Is A Shared Equity Scheme?

The First Home Scheme is a shared equity scheme.

This means the scheme provides part of the purchase price and receives a matching percentage share in the value of the home.

Using the previous example:

• Property price: €400,000
• FHS contribution: €40,000
• FHS share: 10%

You still live in the home, make the mortgage repayments, and look after the property. However, the scheme keeps its 10% share until you buy it back or sell the home.

The scheme does not move into your home or make everyday decisions about the property.

This is why the programme is sometimes called the Shared Equity Scheme Ireland. The scheme shares in the value of the property, rather than providing a normal loan. 

Who Qualifies For The First Home Scheme Ireland?

To qualify, you generally must:

• Be over 18
• Be a first-time homebuyer
• Have mortgage approval from a participating lender
• Have a deposit of at least 10%
• Use the property as your main home
• Purchase or build a qualifying property

There is no specific maximum or minimum household income for the scheme. However, your income still affects how much mortgage funding your lender will approve, and the amount you can get from The First Home Scheme is dependent on the amount of mortgage funding you can receive.

You normally cannot use the FHS if your lender has already allowed you to borrow above the standard mortgage limit through a special lending exception.

Can Previous Homeowners Qualify?

The scheme is not limited only to people who have never owned a home.

Some previous homeowners may qualify under what is often called the Fresh Start principle.

This may include someone who:

• Previously owned a home 
  • Bought it with a spouse or partner and are now separated or divorced
  • No longer has an ownership interest in that home

It may also include someone who lost a previous property through:

• Bankruptcy
• Personal insolvency

Fresh Start cases depend on the buyer’s individual circumstances. If you still own or have a financial interest in a previous home, you will not normally qualify. 

What Homes Qualify?

The FHS can be used for:

• A new-build house or apartment in a private development
• A self-build home on a site you own or are purchasing
• The home you currently rent, in certain cases where your landlord is selling it

A new-build is a newly constructed home that has not previously been lived in.

A self-build is a home you arrange to have built on your own site. This does not mean you must physically build the house yourself.

The property must also:

• Be located in the Republic of Ireland
• Be used as your main home
• Be within the property price limit for its local authority area

The property price limits depend on where you are buying and whether the property is a house, apartment, or self-build.

How Much Can The First Home Scheme Provide?

The First Home Scheme can provide up to 30% of the property purchase price or self-build cost.

However, the maximum falls to 20% if you are also using the Help to Buy Scheme.

The minimum contribution is:

• 2.5% of the property price or build cost
• Or €10,000

Whichever amount is higher applies.

How Does The Percentage Ownership Work?

The percentage provided by the scheme becomes its percentage interest in the property.

For example:

• Original property price: €400,000
• FHS contribution: €40,000
• FHS share: 10%

If the property is later worth €500,000, the FHS still holds a 10% share.

Buying back the full share would then generally go up to 10% of €500,000, which would cost €50,000.

If the property falls in value, the amount needed to buy back the share may also fall.

You can usually buy back all or part of the share later. However, the full share normally has to be repaid if you sell the property.

How Do You Apply?

The application process includes several steps.

1. Get Mortgage Approval In Principle

You first need Approval in Principle from a participating lender. This provides an early indication of how much the lender may allow you to borrow.

2. Calculate Your Missing Funds

Add your deposit and mortgage together, then compare that amount with the property price.

The difference is the funding gap the First Home Scheme may help cover.

3. Check Your Eligibility

Use the official FHS eligibility calculator to estimate whether you qualify and how much support may be available.

4. Submit Your Application

Apply through the FHS customer portal.

You will generally need:

• Mortgage Approval in Principle
• Photo identification
• Proof of address
• Information about the property or self-build

5. Receive Your Eligibility Certificate

If approved, you receive an Eligibility Certificate showing the estimated support available.

6. Complete The Purchase

After your mortgage and FHS documents are approved and signed, the scheme sends the funds to your solicitor.

Your solicitor then uses your deposit, mortgage, and FHS funding to complete the purchase.

The Bottom Line

The First Home Scheme Ireland can help buyers who have a deposit and qualify for a mortgage but are still short of the amount needed to purchase or build a home.

Remember:

• The FHS is a shared equity scheme
• It can provide up to 30% of the property cost
• The maximum falls to 20% when Help to Buy is used
• The scheme receives a percentage share in the property
• You can buy back that share later

The scheme can make home ownership possible sooner. However, it is important to remember that the cost of buying back the share may rise if the property increases in value.

Irish Mortgage Brokers can help you calculate your funding gap, compare participating lenders, and understand whether the First Home Scheme is suitable for your situation.