Historically, lenders have adopted a Loan-to-Income ratio limit when making loan offers. Traditionally this has been 2.5, i.e. a maximum loan of 2.5 times annual gross repeatable earnings would be offered to be repaid over a term of 20 years.
Lenders in the current low-interest climate (2005) justify breaking this limit by stating that affordability, i.e. the proportion of disposable income spent servicing the loan, is reasonable. While this may be true at low interest rates, it is less so at higher interest rates.
Jumbo mortgages are a factor in the Irish Property Bubble.