Step by Step Guide to Pension Borrowing

Interested in investing in property through your pension but don’t have enough funds in your scheme? The solution could be a loan within your pension, but how does it work?

Step 1: Set up your ITC self-administered scheme. Currently our ITC PRSA and ITC Buy Out Bond schemes are eligible for pension property investment and borrowing. Your advisor can assist you in this process.

Step 2: Select the property you wish to purchase through your ITC scheme. We have a number of sample properties available for purchase listed on our site - pensionproperty.ie, along with some useful information and guides. You can use our Pension Mortgage Calculator to check how much you will need to borrow in order to purchase your desired property. 

Step 3: Complete the ITC Propertyline Application form with your advisor.

Step 4: At this point in the process your mortgage advisor can approach the bank with the proposal for finance. A lending option for residential property is available through our partners ICS Mortgages (Dilosk). Loans for commercial property are available through our other banking partners.

Step 5: Once you submit the ITC Propertyline Application Form to service@ITCGroup.ie, ITC will set up an Exempt Unit Trust, to hold the property and the liability. The Unit Trust will be the borrower for the purposes of the bank’s loan documentation and, both ITC and the bank will instruct separate solicitors which will liaise with each other to arrange the drawdown of the loan and perfection of the security.

Step 6: Finally, an account is opened which will collect the rent and on which a direct debit will be set up for the collection of loan repayments. This bank account along with all other accounts is available for viewing on our Client Portal so you can track your rent and any expenses easily.

Revenue Rules

• Only purchased properties may be used as security.
• The borrowing is non-recourse to other assets in the pension scheme
• All loans must be repaid in full before retirement
• Loans can be for no longer than 15 years

For further information, please speak to your financial advisor or email justask@independent-trustee.com.

Fiona Harris
ITC Marketing Manager

_{*Please note this content is the view of the author and not of Independent Trustee Company}