Buying a house 2012

killers1 · 20-07-2012 12:42am

quarryman wrote: »

Is it true that a mortgage refusal will result in damage to your credit rating?

No

killers1 · 20-07-2012 12:46am

JenJo1030 wrote: »

We originally approached a friend in Aib to get some advice on mortgages, not actually intending to apply as I'm currently unemployed (was let go while I was pregnant and baby is only 3 months) and we knew full well we wouldn't be approved for a mortgage of 135k on one income of only 25k. She said that it would definitely be worth applying now so we could take advantage of the mortgage interest relief due to finish at the end of the year and because I'd seen a house that I liked, if we could get a guarantor then we would stand a good chance of being approved now rather than waiting so my dad volunteered and we applied. They came back and said him acting as the second applicant instead of me with a view to us reapplying in 3 years without him to remove him from the mortgage would get us approved, my dad wanted to go ahead with it so we did, waited 3 weeks for a response and they said no again. So we decided to approach bank of Ireland to see how they reacted to the guarantor idea and the mortgage advisor recommended we apply due to the fact that our savings being so strong, proven rental repayment capacity for the last couple of years of 1000pm, a guarantor and my partners job permanency. I'm under no illusions that getting approved will be easy and that it's a strange situation but we figured all they can say is no and we at least we'd have no regrets about not applying. So I was just wondering if BOI are easier to get approval with than AIB?

Unfortunately BOI aren't great when it comes to guarantors. You're proven repayment capacity which is strong was evidenced when you were both employed and had no dependents. The application won't qualify based on income. If you are not married your best bet is for you partner to apply in their own right with/without joint borrower/guarantor and he may have a chance of getting close to that amount provided the repayment capacity is evident from his accounts i.e. rent comes from his account, savings come from & go into a/c in his name etc...

killers1 · 20-07-2012 12:52am

Funnyonion79 wrote: »

Our rebuild valuation- according to the bank's guy - is actually 20k OVER the price that we're paying for the house.

Unbelievable!!

That's not uncommon. Valuers work off a standard chartered surveyors formula for calculating rebuild costs which is based on the size & design of the property whilst also taking into account building cost per sq ft in that particular area at the time. The valuers are always open to discussing their rebuild calculations with the purchaser.

Fearsneachta in Poland · 20-07-2012 5:17pm

I am a first time buyer that has pulled out of a purchase a month ago due to structural problems. We had received our letter of offer from AIB.

We are sale agreed on a new house now. AIB require is to apply again from the beginning. We have all our documents including valuation of new house. Any idea on how long mortgage offer should take?

killers1 · 20-07-2012 8:10pm

Fearsneachta in Poland wrote: »

I am a first time buyer that has pulled out of a purchase a month ago due to structural problems. We had received our letter of offer from AIB.

We are sale agreed on a new house now. AIB require is to apply again from the beginning. We have all our documents including valuation of new house. Any idea on how long mortgage offer should take?

You should have a loan offer within 2 weeks. Even though you have had to supply up to date documentation and probably sign a new application form the underwriting is more straight forward as they use the info from your existing file

paddylonglegs · 20-07-2012 10:32pm

Funnyonion79 wrote: »

Our rebuild valuation- according to the bank's guy - is actually 20k OVER the price that we're paying for the house.

Unbelievable!!

hmm, ours is double the amount we are paying for the house. Walls are 2 foot thick so the demolition is the most cost!

JenJo1030 · 21-07-2012 10:05pm

killers1 wrote: »

Unfortunately BOI aren't great when it comes to guarantors. You're proven repayment capacity which is strong was evidenced when you were both employed and had no dependents. The application won't qualify based on income. If you are not married your best bet is for you partner to apply in their own right with/without joint borrower/guarantor and he may have a chance of getting close to that amount provided the repayment capacity is evident from his accounts i.e. rent comes from his account, savings come from & go into a/c in his name etc...

Thanks for the advice killers, had a feeling that would be the case!

Kazzehh · 22-07-2012 7:05pm

Quick question for those in the know. I am a FTB applying for a mortage this week. I am 19 weeks pregnant

, just wondering do I need to inform the bank of this? The form asks if I have any dependants and I have ticked no as I don't atm. Is this ok or should I inform them of dependants to be? If the application and whole process takes any length of time I'm sure it will become obvious. Any advise appriciated.

Bigcheeze · 22-07-2012 9:03pm

Kazzehh wrote: »

Quick question for those in the know. I am a FTB applying for a mortage this week. I am 19 weeks pregnant , just wondering do I need to inform the bank of this? The form asks if I have any dependants and I have ticked no as I don't atm. Is this ok or should I inform them of dependants to be? If the application and whole process takes any length of time I'm sure it will become obvious. Any advise appriciated.

No you have answered the questions truthfully.

aviendha · 24-07-2012 6:22pm

Update for everyone:
Picked up keys today, 24th July after following timeline:
Nov 2011 - initial offer (rejected)
Feb 2012 - EA makes contact looking for increased offer, and we obliged
Mar 2012 - Offer accepted & Sale agreed, booking deposit paid
Apr 2012 - Final docs for BOI, house ins, life ass (thanks Killers!!) etc - initial closing agreed 18 May
May 2012 - waiting on Vendors to get their bits together, 18 May came and went with no closing as Vendors hadn't sent on contracts at this stage due to issue on title, land registry etc. Just as well, as BOI had loads of pedantic queries that were dripfed over a number of weeks
June 2012 - contracts signed and 10% deposit balance paid, closing date fixed for 23 July
July 2012 - - cheque issued by BOI, but not cashed by solicitor until received info from vendor's solicitor that all was in order
24 July 2012 - keys in hand

Background for us:
Married couple, hubbie has previous celtic-tiger mortgage, but public servant so guaranteed income. I'm private sector, with 1 year permanent in current role after moving to new part of country (previously permanent for 8 yrs).
Husband also recently set up separate business with friend, and between that and myself getting pregnant in the meantime, we were sure our AIP would be reexamined in light of new info, but no trouble with mortgage with BOI.
Between offer letter signing and drawdown of funds = 2 months.

now the fun stuff starts - it's a 1970s house, so completely redoing heating system (new boiler, new tank, solar panels, etc), new windows (to replace wooden existing ones), insulation and after all that, the interior..

long process, but delighted to be at this stage
thanks to all for the advice and chat on this thread and best of luck to everyone in the throes of purchase for 2012

emclau · 24-07-2012 10:35pm

I'm thinking of buying a house in the next year...

I'd be very interested to hear what the difference was on asking price on houses and what people actually purchased them for...

Thanks!

Fearsneachta in Poland · 24-07-2012 11:27pm

Currently sale agreed on house. Settled on a price 10% below most recent asking price.

House had dropped by 23% to new asking price 10 months previously. Reading through the valuation for the bank the rebuild cost is greater than the purchase price.

Best advise I have received about putting an offer on a house was "If you are not embarassed by the offer you are making then you are offering too much".

Separately what a great resource this is, Just found it recently. Staying up late every night reading it all from the beginning. Thanks to killers advise all the way through (Only on Page 19 so far)!!!!

Afehogan · 25-07-2012 12:15am

Hi contracts signed and sent to vendor today! Hoping to get in ASAP as the house is vacant from next week hopefully!
With regard to house insurance, does the insurance have to be in place before the cheque is issued by the bank or before the closing date?
Have forms ready to go but don't want this to hold us up!
Also how long would it take usually for cheque to be issued/cleared?

Tofu · 25-07-2012 7:59am

killers1 wrote: »

If you need any advice here just ask!!

Thanks a mill Killers!

Looks like nearly 3 months later I am finally mortgage approved! Although I am completely cynical now about the whole process so I'm not going to breathe a sigh of relief yet. May be back to you for advice

aviendha · 25-07-2012 9:19am

Afehogan wrote: »

Hi contracts signed and sent to vendor today! Hoping to get in ASAP as the house is vacant from next week hopefully!
With regard to house insurance, does the insurance have to be in place before the cheque is issued by the bank or before the closing date?
Have forms ready to go but don't want this to hold us up!
Also how long would it take usually for cheque to be issued/cleared?

yes buildings insurance will have to be in place before the cheque is issued - I would advised getting the forms in asap if you want to get a move on into the house, our experience was that we had buildings insurance in place but bank found one or two pedantic questions to drag the whole thing out and we had to get reissued original policy documents to satisfy them. This resulted in us paying for 1.5 months of house insurance unnecessarily, but small price to pay to speed up the process
Issues encountered:
1 - while both names were on the copy policy docs received, only one name was printed on the original docs that were required by the bank
2 - the address of the property is in the country, and while the insurance online form would only accept An Post recognised addresses, we had to call up later to amend it to add the (old) house name to the policy docs
3 - buildings insured amount must agree to the reinstatement value per the bank's valuer's report... we had issues whereby the valuer had an incorrect reinstatement value so we had to get a whole new valuation report issued by them

We had contracts signed in May on a vacant house (elderly couple passed away) and only yesterday got keys, so don't hold your breath! Best of luck!

Funnyonion79 · 25-07-2012 2:32pm

Thanks for that info aviendha - I've taken note of your points, as I've just completed my house insurance and am waiting to receive my letter of indemnity so I can pass it on to my broker. Will make sure I give him the original and keep a copy for myself. My broker said he doesn't require my policy docs - but did you say BOI asked for them? Will give him everything, just in case and will also ensure that both our names are on the policy - which they should be.

In other news - looks like I'm not going to close on 16th Aug after all. We're still waiting on the vendor to supply 2 certs of compliance for an extension - which should be ready by tomorrow and in an ideal world, the certs would arrive with our solicitor and we'd sign the contracts before he goes on hols for a week next week.

However, my solicitor has just found out, that the vendors haven't yet finalised an agreement with their bank on the negative equity part of their mortgage. We are purchasing the house for X amount and there's still a substantial amount owed to the bank in negative equity, which is supposed to be paid by the vendor's father-in-law. However this hasn't happened yet (think they're meeting the bank tomorrow to sort it out).

My solicitor is really pissed off cos he's saying that the vendor's solicitor should NOT have issued contracts until this issue was resolved because until it's sorted - the house isn't theirs to sell. He's saying the contracts are null and void and he has advised the vendor's solicitor that we won't be signing anything until we see proof that the negative equity has been paid. He's under the impression that the vendor's solicitor was trying to pull a fast one on us but making us sign contracts for the house so that the vendors could then go to the bank and try and get the negative equity written off. If the bank refused, I'm assuming that this would then become our problem, as legally we would own the house....would this be right? This is just my interpretation of my solicitor's emails - my other half is talking to him as we speak, to clarify what all the significance of this is....has anyone else had this experience?

We're heading on holidays the last two weeks in August so it would appear now that we won't get to close now until September

:(

Marcusm · 25-07-2012 3:20pm

Funnyonion79 wrote: »

Thanks for that info aviendha - I've taken note of your points, as I've just completed my house insurance and am waiting to receive my letter of indemnity so I can pass it on to my broker. Will make sure I give him the original and keep a copy for myself. My broker said he doesn't require my policy docs - but did you say BOI asked for them? Will give him everything, just in case and will also ensure that both our names are on the policy - which they should be.

In other news - looks like I'm not going to close on 16th Aug after all. We're still waiting on the vendor to supply 2 certs of compliance for an extension - which should be ready by tomorrow and in an ideal world, the certs would arrive with our solicitor and we'd sign the contracts before he goes on hols for a week next week.

However, my solicitor has just found out, that the vendors haven't yet finalised an agreement with their bank on the negative equity part of their mortgage. We are purchasing the house for X amount and there's still a substantial amount owed to the bank in negative equity, which is supposed to be paid by the vendor's father-in-law. However this hasn't happened yet (think they're meeting the bank tomorrow to sort it out).

My solicitor is really pissed off cos he's saying that the vendor's solicitor should NOT have issued contracts until this issue was resolved because until it's sorted - the house isn't theirs to sell. He's saying the contracts are null and void and he has advised the vendor's solicitor that we won't be signing anything until we see proof that the negative equity has been paid. He's under the impression that the vendor's solicitor was trying to pull a fast one on us but making us sign contracts for the house so that the vendors could then go to the bank and try and get the negative equity written off. If the bank refused, I'm assuming that this would then become our problem, as legally we would own the house....would this be right? This is just my interpretation of my solicitor's emails - my other half is talking to him as we speak, to clarify what all the significance of this is....has anyone else had this experience?

We're heading on holidays the last two weeks in August so it would appear now that we won't get to close now until September :(

Make sure that you're very careful here. I am buying in a bank encouraged sale with an acknowledgement that the amount paid will never repay the loan. Insist on a letter from the lending institution setting out the basis on which the mortgage (which is actually the charge or security not the loan) will be released. Consider having funds released only to that institution against documents releasing the mortgage or against your solicitor being granted power of attorney from the bank (not the vendor) of the mortgage/charge/security. Solicitors from what I have seem (mine is good and technical) are not sufficiently au fair with these practicalities and want to rely on "undertakings" which are worth nothing more than a claim on the Law Society compensation fund. That way bankruptcy lies....

sarkozy · 25-07-2012 4:03pm

I have to drop some documents into my bank for my mortgage approval, and I can't get hold of the manager to ask this.

We have to sign the Deed of Assignment of Life Policy (for BoI).

It's in legalese, and I'm not precisely sure what section we need to sign and if it must be signed with a witness.

This and some final documents we need to get in as soon as possible.

Thanks.

Funnyonion79 · 25-07-2012 4:05pm

Marcusm wrote: »

Make sure that you're very careful here. I am buying in a bank encouraged sale with an acknowledgement that the amount paid will never repay the loan. Insist on a letter from the lending institution setting out the basis on which the mortgage (which is actually the charge or security not the loan) will be released. Consider having funds released only to that institution against documents releasing the mortgage or against your solicitor being granted power of attorney from the bank (not the vendor) of the mortgage/charge/security. Solicitors from what I have seem (mine is good and technical) are not sufficiently au fair with these practicalities and want to rely on "undertakings" which are worth nothing more than a claim on the Law Society compensation fund. That way bankruptcy lies....

Thanks Marcus - I'll say this to my solicitor tomorrow to give him a heads up but he appears to be on top of things, as he says he's dealt with the vendor's solicitor before and thinks he's a messer. He's on the lookout for him now and won't be letting him away with anything unless all the t's are crossed and all the i's dotted!!

killers1 · 25-07-2012 4:17pm

sarkozy wrote: »

I have to drop some documents into my bank for my mortgage approval, and I can't get hold of the manager to ask this.

We have to sign the Deed of Assignment of Life Policy (for BoI).

It's in legalese, and I'm not precisely sure what section we need to sign and if it must be signed with a witness.

This and some final documents we need to get in as soon as possible.

Thanks.

3rd page, halfway down and can be witnessed by anyone. 1 signature each...

killers1 · 25-07-2012 4:18pm

aviendha wrote: »

Update for everyone:
Picked up keys today, 24th July after following timeline:
Nov 2011 - initial offer (rejected)
Feb 2012 - EA makes contact looking for increased offer, and we obliged
Mar 2012 - Offer accepted & Sale agreed, booking deposit paid
Apr 2012 - Final docs for BOI, house ins, life ass (thanks Killers!!) etc - initial closing agreed 18 May
May 2012 - waiting on Vendors to get their bits together, 18 May came and went with no closing as Vendors hadn't sent on contracts at this stage due to issue on title, land registry etc. Just as well, as BOI had loads of pedantic queries that were dripfed over a number of weeks
June 2012 - contracts signed and 10% deposit balance paid, closing date fixed for 23 July
July 2012 - - cheque issued by BOI, but not cashed by solicitor until received info from vendor's solicitor that all was in order
24 July 2012 - keys in hand

Background for us:
Married couple, hubbie has previous celtic-tiger mortgage, but public servant so guaranteed income. I'm private sector, with 1 year permanent in current role after moving to new part of country (previously permanent for 8 yrs).
Husband also recently set up separate business with friend, and between that and myself getting pregnant in the meantime, we were sure our AIP would be reexamined in light of new info, but no trouble with mortgage with BOI.
Between offer letter signing and drawdown of funds = 2 months.

now the fun stuff starts - it's a 1970s house, so completely redoing heating system (new boiler, new tank, solar panels, etc), new windows (to replace wooden existing ones), insulation and after all that, the interior..

long process, but delighted to be at this stage
thanks to all for the advice and chat on this thread and best of luck to everyone in the throes of purchase for 2012

You finally got there!! Congrats and best of luck with your move!!!

doc holliday · 26-07-2012 2:38pm

Hi , I have applied for a mortgage of 130,000 with BOI. ( the maximum amount i can borrow according to BOI website calculator based on my gross wage of 26,000 ). I am now just awaiting their response. I was just wondering does anyone think i could get the full 130,000?

I am 27.
I have been saving 1,000 pm for the last 9 months.
My partner has 5,000 in his current account so we have total savings of 14,000.
We also have a gift of 8,000 from my parents.
I have no loans.
I pay rent of 300 pm but it is in cash so cannot be counted in the application.
The BOI mortgage advisor who set up the application for me seemed fairly confident I would get the full value.(130,000).

The house we are looking at is priced at 165,000 but after speaking with the EA i would be fairly confident of getting it at around the 140,000 mark.
The EA told me they had accepted 154,000 for the house in January but that fell through.

The reason I am applying on my own is due to my partner having bad credit history.

I just want to know should i bother getting my hopes up?

Tombo2001 · 26-07-2012 4:28pm

doc holliday wrote: »

Hi , I have applied for a mortgage of 130,000 with BOI. ( the maximum amount i can borrow according to BOI website calculator based on my gross wage of 26,000 ). I am now just awaiting their response. I was just wondering does anyone think i could get the full 130,000?

I am 27.
I have been saving 1,000 pm for the last 9 months.
My partner has 5,000 in his current account so we have total savings of 14,000.
We also have a gift of 8,000 from my parents.
I have no loans.
I pay rent of 300 pm but it is in cash so cannot be counted in the application.
The BOI mortgage advisor who set up the application for me seemed fairly confident I would get the full value.(130,000).

The house we are looking at is priced at 165,000 but after speaking with the EA i would be fairly confident of getting it at around the 140,000 mark.
The EA told me they had accepted 154,000 for the house in January but that fell through.

The reason I am applying on my own is due to my partner having bad credit history.

I just want to know should i bother getting my hopes up?

I think you should go into a bank and discuss it with them. I doubt you will get a mortgage for that amount on your own salary. And if I was you, I wouldnt want to either.

If your take home is circa €1800 a month, and your mortgage is circa €800 a month......then that doesnt leave you with much disposable income. Bear in mind you will have a lot of costs you didnt have as a renter, household charge for example. Maybe you feel it is enough.

If you are confident your income will rise, that is another matter.

Whatever you do, dont go down the road of a 35 year mortgage just to make the maths work in the short term.

The other thing is, from your own point of view : you will be the full owner of the property if you take out the mortgage....as such how do you factor in your partners contribution. Will you be paying this back to him?

clogs2 · 26-07-2012 5:14pm

hi
also hoping to buy in 2012!have found an ideal house, have mortgage approval in principle...

shopaholic01 · 26-07-2012 5:21pm

Tombo2001 wrote: »

I think you should go into a bank and discuss it with them. I doubt you will get a mortgage for that amount on your own salary. And if I was you, I wouldnt want to either.

If your take home is circa €1800 a month, and your mortgage is circa €800 a month......then that doesnt leave you with much disposable income. Bear in mind you will have a lot of costs you didnt have as a renter, household charge for example. Maybe you feel it is enough.

If you are confident your income will rise, that is another matter.

Whatever you do, dont go down the road of a 35 year mortgage just to make the maths work in the short term.

The other thing is, from your own point of view : you will be the full owner of the property if you take out the mortgage....as such how do you factor in your partners contribution. Will you be paying this back to him?

Also look into the legalities if you split up - you will be the sole legal owner and mortgagee. If you cohabit for 2 years without a cohabitants agreement he will be entitled to a portion of the equity, you may also be liable for maintenance if they are unemployed or earning very little afaik. If you split before the 2 year period your partner has no rights. It can turn into a messy and expensive legal case. I would also be wary given his credit history.

doc holliday · 26-07-2012 5:57pm

Tombo2001 wrote: »

I think you should go into a bank and discuss it with them. I doubt you will get a mortgage for that amount on your own salary. And if I was you, I wouldnt want to either.

If your take home is circa €1800 a month, and your mortgage is circa €800 a month......then that doesnt leave you with much disposable income. Bear in mind you will have a lot of costs you didnt have as a renter, household charge for example. Maybe you feel it is enough.

If you are confident your income will rise, that is another matter.

Whatever you do, dont go down the road of a 35 year mortgage just to make the maths work in the short term.

The other thing is, from your own point of view : you will be the full owner of the property if you take out the mortgage....as such how do you factor in your partners contribution. Will you be paying this back to him?

Thanks Tombo,

We have a combined take home of 3,400 pm, my fiancee does have a loan of 170 pm but thats it. So for the purposes of paying the mortgage and all other expenses there is over 3,200 remaining to pay for a mortgage of circa 800 pm. In that sense I would be hoping that we should be able to manage the mortgage and all other expenses fairly comfortably. I wouldnt be paying my fiancee's contribution back to her.

The problem is we have to get the mortgage based on 1 wage of 26,000 yet there will be 2 wages totalling 46,500 gross financing the repayments.

Yeah I am not too confident that I will get approval for the 130,000 but I live in hope.

Thanks for the reply tombo, appreciate the advice.

Muirne · 27-07-2012 9:25am

Hi, we've just gotten approval in principle for a 92 per cent mortgage and are approved for what we asked for - 160k. Our situation is as follows:

Combined income of 74k. My husband works in private sector. He was unemployed for about a year and did a job bridge scheme for 6 months and he got offered a permanent contract at the end so he's been in his job a year now.

I'm a public servant with 12 years service.

We have 2 children and savings of about 17k. During the year while he was unemployed we still managed to save 200 each month and since he's been working full-time we've been saving 1400 per month. I think savings are key and while we wouldn't have huge savings they've been growing very steadily.

We went through a broker and got approval from AIB. The only thing they really looked for was a letter from my husband's employer to say his probation was finished.

To be honest when we were told we'd been approved I was floored as I expected them to say come back in 6 months. So we're delighted.

Been on the phone to estate agents since organising viewings. Looking at the first one today. There's one for sale in the estate we're renting in. Been on the market for about a year and surprise surprise the agent tells me there's an offer of 170k in on it (asking price is 195). Not sure I believe him!

Sala · 27-07-2012 12:11pm

Well done Muirne. I agree savings are key. It doesn't seem to matter to the bank any more if you have thousands in gifts, inheritance etc, they really are looking at your monthly rent + steady savings

killers1 · 27-07-2012 1:46pm

Sala wrote: »

Well done Muirne. I agree savings are key. It doesn't seem to matter to the bank any more if you have thousands in gifts, inheritance etc, they really are looking at your monthly rent + steady savings

Inheritance & gifts are largely irrelevant... The decision to lend is based solely on your incomes qualifying you to borrow the amount you need and secondly that you have a proven repayment capacity for the stressed mortgage repayments evidenced over a sufficient period of time based on rent, savings + loan repayments on facilities not continuing after drawdown.

killers1 · 27-07-2012 1:49pm

Muirne wrote: »

Hi, we've just gotten approval in principle for a 92 per cent mortgage and are approved for what we asked for - 160k. Our situation is as follows:

Combined income of 74k. My husband works in private sector. He was unemployed for about a year and did a job bridge scheme for 6 months and he got offered a permanent contract at the end so he's been in his job a year now.

I'm a public servant with 12 years service.

We have 2 children and savings of about 17k. During the year while he was unemployed we still managed to save 200 each month and since he's been working full-time we've been saving 1400 per month. I think savings are key and while we wouldn't have huge savings they've been growing very steadily.

We went through a broker and got approval from AIB. The only thing they really looked for was a letter from my husband's employer to say his probation was finished.

To be honest when we were told we'd been approved I was floored as I expected them to say come back in 6 months. So we're delighted.

Been on the phone to estate agents since organising viewings. Looking at the first one today. There's one for sale in the estate we're renting in. Been on the market for about a year and surprise surprise the agent tells me there's an offer of 170k in on it (asking price is 195). Not sure I believe him!

Your application was a complete no brainer to be honest an no surprise you were approved based on those figures/circumstances. I'd be inclined not to believe the EA is that situation... Ask them when the offer was put in, has it been rejected and take it from there...

Buying a house 2012

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