Question: I’m hoping to build my own home and plan to apply for a self-build mortgage in about a year. I’m in a permanent job and have decent savings, but I want to ensure the process is as straightforward as possible. What steps can I take over the next 12 months to get mortgage-ready? Should I open a special savings account just for the mortgage? How do I make sure my current account looks good to lenders? Should I use Revolut for day-to-day spending or stick with cash withdrawals?
Answer: Taking a proactive approach over the next 12 months will significantly improve your chances of securing a self-build mortgage with less stress. With a steady job and solid savings, you’re off to a great start – now it’s time to build a strong financial profile that lenders will feel confident supporting. Here’s a structured, month-by-month strategy to help.
Focus on consistent savings: Lenders love to see consistency, especially when it comes to saving. Over the next six months, aim to save at least the equivalent of what your future monthly mortgage payment will be – plus an additional 2% buffer to show you can handle interest rate increases (this is known as a stress test).
If you’re currently renting, those payments will support your affordability track record, but savings offer even stronger proof. Once you begin this savings pattern, avoid dipping into those funds unless absolutely necessary – consistency matters more than the total amount saved.
Build your deposit: In parallel with demonstrating affordability, continue building your deposit in a separate, clearly labelled savings account. For self-build mortgages, you’ll typically need a minimum deposit of 20-25%.
Keep these funds in a standard savings or current account that generates easy-to-understand statements – transparency is key. Avoid mixing your deposit savings with your day-to-day expenses. Clear documentation makes it easier for lenders to verify your funds.
Manage existing debt: Lenders take a careful look at any outstanding debt. This includes credit cards, personal loans, or any short-term borrowing.
Aim to reduce these balances over the next few months. However, don’t clear debt by using your deposit money – this might leave you short when it comes time to apply. Instead, take a balanced approach: showing you can manage debt responsibly while maintaining savings strengthens your application.
Bank statement management: Lenders generally review three to six months’ worth of bank statements before approval. That means the period before your mortgage application is critical. It’s not just about how much you spend – but what you spend it on. Cut down on unnecessary outgoings like impulse purchases, online shopping splurges, or frequent nights out. It’s okay to live your life, but the overall picture should reflect a stable, responsible spender.
Many people wonder if using apps like Revolut helps clean up their primary current account.
Lenders prefer seeing traceable transactions. Use your main account wisely and make your spending behaviour transparent and disciplined
While the app can be useful for budgeting, lenders will ask for statements from all financial accounts including Revolut.
As for day-to-day spending, there’s no need to rely solely on cash. In fact, regular small cash withdrawals without clear use can be a red flag. Lenders prefer seeing traceable transactions. Use your main account wisely and make your spending behaviour transparent and disciplined.
Do you need a mortgage saver account?: It’s a common myth that you need to open a specialised mortgage savings account to boost your approval chances. While these accounts may offer marginally higher interest or a savings incentive, they’re not essential. A regular savings account will do just fine, provided it shows a consistent, disciplined savings pattern. The key factor for lenders is the regularity of deposits and clarity of source, not the account type.
Stay organised and document everything: Keep detailed records of all your savings and debt repayments. Download monthly statements and store them in a dedicated folder – physical or digital. If you receive gifts or lump-sum transfers (eg from family to support your build), ensure these are clearly documented and traceable. Starting your preparation 12 months in advance puts you in an excellent position. The key is demonstrating financial responsibility and stability. Lenders need to see you can handle both the regular mortgage payments and the unique challenges of a self-build project.
Get a copy of your credit report and address any issues (centralcreditregister.ie).Avoid applying for new credit in the months before your mortgage application.Gather necessary documentation (payslips, tax returns, ID, proof of address).Consider speaking with a mortgage broker who specialises in self-build projects.
Noreen Lacey, Head of Banking at Ifac Ireland.
Noreen Lacey, head of banking with ifac, the professional services firm for farming, food and agri-businesses.
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Question: I’m hoping to build my own home and plan to apply for a self-build mortgage in about a year. I’m in a permanent job and have decent savings, but I want to ensure the process is as straightforward as possible. What steps can I take over the next 12 months to get mortgage-ready? Should I open a special savings account just for the mortgage? How do I make sure my current account looks good to lenders? Should I use Revolut for day-to-day spending or stick with cash withdrawals?
Answer: Taking a proactive approach over the next 12 months will significantly improve your chances of securing a self-build mortgage with less stress. With a steady job and solid savings, you’re off to a great start – now it’s time to build a strong financial profile that lenders will feel confident supporting. Here’s a structured, month-by-month strategy to help.
Focus on consistent savings: Lenders love to see consistency, especially when it comes to saving. Over the next six months, aim to save at least the equivalent of what your future monthly mortgage payment will be – plus an additional 2% buffer to show you can handle interest rate increases (this is known as a stress test).
If you’re currently renting, those payments will support your affordability track record, but savings offer even stronger proof. Once you begin this savings pattern, avoid dipping into those funds unless absolutely necessary – consistency matters more than the total amount saved.
Build your deposit: In parallel with demonstrating affordability, continue building your deposit in a separate, clearly labelled savings account. For self-build mortgages, you’ll typically need a minimum deposit of 20-25%.
Keep these funds in a standard savings or current account that generates easy-to-understand statements – transparency is key. Avoid mixing your deposit savings with your day-to-day expenses. Clear documentation makes it easier for lenders to verify your funds.
Manage existing debt: Lenders take a careful look at any outstanding debt. This includes credit cards, personal loans, or any short-term borrowing.
Aim to reduce these balances over the next few months. However, don’t clear debt by using your deposit money – this might leave you short when it comes time to apply. Instead, take a balanced approach: showing you can manage debt responsibly while maintaining savings strengthens your application.
Bank statement management: Lenders generally review three to six months’ worth of bank statements before approval. That means the period before your mortgage application is critical. It’s not just about how much you spend – but what you spend it on. Cut down on unnecessary outgoings like impulse purchases, online shopping splurges, or frequent nights out. It’s okay to live your life, but the overall picture should reflect a stable, responsible spender.
Many people wonder if using apps like Revolut helps clean up their primary current account.
Lenders prefer seeing traceable transactions. Use your main account wisely and make your spending behaviour transparent and disciplined
While the app can be useful for budgeting, lenders will ask for statements from all financial accounts including Revolut.
As for day-to-day spending, there’s no need to rely solely on cash. In fact, regular small cash withdrawals without clear use can be a red flag. Lenders prefer seeing traceable transactions. Use your main account wisely and make your spending behaviour transparent and disciplined.
Do you need a mortgage saver account?: It’s a common myth that you need to open a specialised mortgage savings account to boost your approval chances. While these accounts may offer marginally higher interest or a savings incentive, they’re not essential. A regular savings account will do just fine, provided it shows a consistent, disciplined savings pattern. The key factor for lenders is the regularity of deposits and clarity of source, not the account type.
Stay organised and document everything: Keep detailed records of all your savings and debt repayments. Download monthly statements and store them in a dedicated folder – physical or digital. If you receive gifts or lump-sum transfers (eg from family to support your build), ensure these are clearly documented and traceable. Starting your preparation 12 months in advance puts you in an excellent position. The key is demonstrating financial responsibility and stability. Lenders need to see you can handle both the regular mortgage payments and the unique challenges of a self-build project.
Get a copy of your credit report and address any issues (centralcreditregister.ie).Avoid applying for new credit in the months before your mortgage application.Gather necessary documentation (payslips, tax returns, ID, proof of address).Consider speaking with a mortgage broker who specialises in self-build projects.
Noreen Lacey, Head of Banking at Ifac Ireland.
Noreen Lacey, head of banking with ifac, the professional services firm for farming, food and agri-businesses.
Read more
Should you register for VAT or stick with VAT58?
Retiring at different times? how to manage your cash
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