Home Buyers Guide

Chapter 1: The 10 Steps to Buying Your First Home:

6: Letter of Offer

A letter of offer is the contract between you and the bank, which outlines the terms under which they will lend you the money. It outlines:

• The purchase price

• The amount you will borrow

• The mortgage term (i.e. how many years you are taking the mortgage over)

• What type of rate you are choosing (e.g. fixed rate, tracker rate, variable rate)

• What is the initial interest rate

• Any conditions which need to be met, before the mortgage cheque is issued

2 copies of the letter of offer should be issued – one to you and one to your solicitor. As soon as you get it you
should read through it carefully, paying particular attention to the ‘special conditions’.

Important: These ‘special conditions’ have to be complied before you get the mortgage cheque, so make sure you are in a position to satisfy all these conditions.

These conditions could include:

• Provide the bank an original mortgage protection policy

• Provide the bank a home insurance ‘letter of indemnity’

• Give evidence of where you are getting your deposit

• Letter from your parents to confirm that money they have given you for a deposit is a gift not a loan.

• Evidence that a loan has been paid off

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