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first-time buyers

FIRST-TIME buyers' mortgage relief is to be scrapped in less than three months.

Up to €416.67 is repaid directly back to mortgage holders' bank accounts each month.

But now this interest relief scheme will be abolished sooner than expected under the Programme for Government.

Currently a first-time buyer has to the end of the year to complete the purchase of a new home and begin paying their mortgage in order to qualify for the relief, which is available for up to seven years after buying.

Plans by the new Government to boost mortgage tax relief for the "negative equity generation" who bought between 2004 and 2008 mean the relief for first-time buyers will go earlier than was planned by the last government.

The maximum qualifying interest amount for a first-time couple is €20,000. In year one and two of purchasing, the maximum interest relief is 25pc, or €5,000 annually.

This reduces to €4,500 in years three, four and five and to €4,000 in years six and seven.

Director of Moneycoach.ie, Frank Conway, said that over a seven-year period, a qualifying first-time buyer couple could receive a maximum relief of €31,500.

"The generous relief was originally due to be phased out at the end of 2011, but this looks set to be brought forward to June of this year and it is not clear if the effective date for the change is the start of the end of the month," he said.