Michael Dowling: Central Bank rules are very blunt for borrowers

The rules the Central Bank introduced for mortgage applicants in February last year, the so-called Macro Prudential Rules, are a very blunt instrument.

The Central Bank is completing its review of the rules. The rules work by capping mortgage loans at 3.5 times gross salary; setting a 90% loan-to-value maximum lending up to a purchase price of €220,000 and establishing an 80% ratio on the difference above this figure.

On a purchase price of €300,000, the borrower can access a maximum of €262,000. Exemptions can apply.