What is a letter of offer on a self-build mortgage?

How it works in Ireland

An approval in principle tells you roughly how much a lender might lend. It is not a loan offer. The letter of offer is the formal step after the lender has assessed your application, the site and the plans. It states the amount, the rate options, how the loan is paid out and what you have to do.

For a self-build, the schedule of drawdown stages matters as much as the rate. It says how many stages there are, what each must show, and how much is released. Time limits are part of it: an offer usually lapses if you do not draw down within a set period, and the final drawdown has its own limit. Check both dates against your programme and add margin for delays.

The letter also lists conditions, often including insurance in place before the first release, evidence of title, planning permission and compliance documents at the end. Failing a condition can hold up money.

Have your solicitor read it and explain anything unclear. If the dates look tight, ask the lender about extensions before signing, not after you have missed one.

What to ask

Read the conditions list line by line and ask what happens if you miss a date. Check the first-drawdown limit, the final-drawdown limit, the stage amounts, the insurance and title conditions, and whether the rate is fixed and for how long. If your plans or timing could change, such as a long planning delay, ask whether an offer can be extended and what it would cost, so there are no surprises later.

A common mistake

Treating the offer as the end of the paperwork. Put the deadlines in your calendar the day it arrives, because missing one can mean reapplying.