Mortgage Interest Relief

P

phoenix_n

Guest
With all the talk about changes in Mortgage Interest Relief i have a query.

(i did know the answer but have forgotten it)

If a FTB buys a house and in a years sells it and then buys another house does he then lose his mortgage interest relief as he no longer is regarded as a FTB.
 
No-the 'FTB' part is somewhat misleading. You qualify for FTB relief for 7 years from the date of your first claim, no matter how often you buy and sell within that timeframe.
 
CCOVICH said:
No-the 'FTB' part is somewhat misleading. You qualify for FTB relief for 7 years from the date of your first claim, no matter how often you buy and sell within that timeframe.
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Cheers. I assume then that if you bought a house and sold it within 2 years and then rented for 2 years that when you bought again you would still have 5 years relieft claim ?
 
I'm not sure about that-the issue was discussed at length here on AAM some time ago. I can't say whether the wording is 'from 7 years of the first claim' or '7 years at the FTB rates'.

Edit-this post would imply that gaps are allowable.
 
Well apparently not. I phoned up the revenue ( curious ) and once you claim for the relief the clock starts and runs concurrently for 7 years . So In my example , bought 2 years,sold, rented 2 years, and bought again you would only have 3 years left of your relief.

Its interesting in that it would be an argument against selling up (and losing out on your relief) and re-entering the market.


CCOVICH said:
I'm not sure about that-the issue was discussed at length here on AAM some time ago. I can't say whether the wording is 'from 7 years of the first claim' or '7 years at the FTB rates'.

Edit-this post would imply that gaps are allowable.
Click to expand...
 
Only really a relatively minor factor though to tilt the balance

The speculation in the weekend papers was for Interest Relief to double so a FTB couple the relief would climb to €16,000 from €8,000 (non FTB relief would be €10,160)

It's only allowable at the standard rate though - so it's worth €3,200pa .. or €266pm ... but then you get €170 of that anyway if you're a non ftb

Also to get the full benefit you've got to be paying 16,000 interest pa on your mortgage - I assume this is interest.. not interest + repayments ... so at a 4% rate you'll only be able to claim the full amount on mortages over €400k balance outstanding.

So if you sold up and lost say 3 years of your FTB allowance the difference (assuming the speculation about doubling the rates is correct) would be €96pm for 3 years .. so just under €3500 ... a reasonable amount for sure ... but probably only a marginal influence in the keep/sell & rent equation .. assuming my sums are right !
 
Hi Guys,
Quick question, my partner and I bought our house 3 years ago - so are still on the higher relief, will our relief increase if relief for FTB's increases?
Many thanks :)
 
pinkyBear said:
Hi Guys,
Quick question, my partner and I bought our house 3 years ago - so are still on the higher relief, will our relief increase if relief for FTB's increases?
Many thanks :)
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I would think yes.......
 
simple question - will a couple not married who are taking out a mortgage get the full benefit of mortgage interest relief - i.e 266 p.m?
 
roadrunner said:
simple question - will a couple not married who are taking out a mortgage get the full benefit of mortgage interest relief - i.e 266 p.m?
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Yes. Each of you can avail of the TRS to your portion of the mortgage (also the same for married couples on seperate assessment) with the higher rate for both if still within the higher FTB term of 7 years.

phoenix_n said:
I would think yes.......
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Also, to confirm Phoenix's reply, yes. You'll recieve the higher rate for the remainder of your 7 year FTB TRS status. As it's a (VERY) frequent question I'll also confirm that if, within the 7 year TRS term, you and your partner trade up to a new property, even though your a second time buyer, you still recieve the benefits of your 7 year TRS FTB term.
 
Satanta said:
As it's a (VERY) frequent question I'll also confirm that if, within the 7 year TRS term, you and your partner trade up to a new property, even though your a second time buyer, you still recieve the benefits of your 7 year TRS FTB term.
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Now I am confused. So when would someone only get the TRS relief as a non-ftb buyer.
 
phoenix_n said:
Now I am confused. So when would someone only get the TRS relief as a non-ftb buyer.
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Once they have owned a property for 7 years (7 years from the day of the first purchase, it doesn't matter how many properties they may buy or sell in this time, or even if they don't own a property for some of this time, 7 years from the first purchase they lose the FTB TRS status and move to the non FTB relief).
 
CCOVICH said:
No-the 'FTB' part is somewhat misleading. You qualify for FTB relief for 7 years from the date of your first claim, no matter how often you buy and sell within that timeframe.
Click to expand...

That's very interesting.... I bought as a FTB in 2002 & received higher relief for 2 yrs. I traded up in 2004 & have received lower relief since. I presumed because I was no longer first time buyer status & that the 7 yrs didn't apply in the case of moving.
Is this definite that I should have continued to receive higher relief? If so, I will query with tax office...
 
phoenix_n said:
Now I am confused. So when would someone only get the TRS relief as a non-ftb buyer.
Click to expand...

In my understanding of it you go to the lower rate if it's more than 7 years since the purchase of their first property then you revert to the lower rate

So you'd get the "FTB" rate for

- The first seven years of your first mortgage, thereafter it reverts to the lower rate.
or
- If you sold your first house after four years and then immediately bought another one you'd get the "FTB" relief for the first 3 years of the new mortgage too, thereafter it reverts to the lower rate.

etc.
 
dillons said:
Is this definite that I should have continued to receive higher relief? If so, I will query with tax office...
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Yes. 7 years with the higher TRS. Moving or Remortgaging doesn't (/or shouldn't, an error was made somewhere) change this.
 
I had the same experience as dillons. I traded up within 7 years and my TRS decreased for my second mortgage. The same happened with a friend of mine. At the time, I read somewhere that if you change mortgages within the 7 years, that this is what happens. However, it seems that different people have had different experiences in relation to this.

As far as I know, it's up to individual banks to claim TRS on behalf of their customers, so unless you specify to them that you haven't passed the 7 year mark on your second mortgage, then I'm wondering if it's possible that the bank may not notice and therefore only apply for the normal rate of TRS?
 
Couple of reasons I guess. The 7 year timeframe may not have applied in the past, and is there any chance you were paying less interest annually under a subsequent mortgage? Remember that the ceiling is the maximum you can claim, but you can't claim for more than the amount of interest you pay.

I would certainly query with Revenue.
 
Ok so for the following:

Man buys house (FTB) claiming FTB mortgage relief. 2002
Woman busy house (FTB) claiming FTB mortgage relief. 2003


They then sell and buy in 2008. (man has 1 year and woman 2 years ftb relief left)
Can the man and woman claim ftb mortgage relief for 1 more year (half each) and then only the woman (1/2 only) on the remaining year.
 
Hello.

My husband and I were FTB in 2004 when we bought an apt.

We sold the apt in 2005 and bought a house.

Have just sold this house and have purchased a new one.

Question is: do we qualify for this special treatment or has our FTB status in terms of TRS passed?

Cheers!
 
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