Central Bank recommends cap of 80% mortgages
The Central Bank said lenders should consider new limits on the amount of money people can borrow for buying houses.
In a research note, it says banks should not lend over 80% of a property's value.
It also suggests that potential housebuyers should not be granted mortgages valued at over four times their income.
The recommendations, known as loan-to-value and loan-to-income limits, came in a research note from the Central Bank published yesterday.
The Bank noted that lending at high LTI ratios had declined since 2006, but LTV ratio loans were "still significant", and that 50% of new loans to owner occupiers were made at more than 80% of the home value.
It also noted that defaults were much more common among customers with high LTI and LTV rations.
