TSB Will Lend The Deposit??

audge

Hi,

at this stage you probably all know i have just graduated from college and have been working in my new job for about 6 weeks. I earn 25k p/a, and this is due to go up to 28k in about 4 months or so.

I decided to give a mortgage advicer a call and see what the craic is.

Basically, he told me that on my earnings I could get a mortgage for about 180k, once I could show regular earnings (so I have to wait a few months and gather up my pay slips), and have the deopsit of 18k.

All of this is wonderful news as I have my eye on a tidy little house in laois that would come in for around the 175k mark.

One problem, I don't have a deposit, (shock, horror) and I told the advicer this, and he seemed to believe that TSB will lend you your deposit?!?!?!

Now this has totally confused me, as TSB would also be the mortgage lender, why would they lend me the deposit, giving them no security on the mortgage?

The advicer tried to explain how it works, but to be honest, it all went over my head.
Has anyone here ever heard of a bank lending you the deposit for your mortgage?
How does it work?

audge

Anyone?;)

Salmon

by deposit do you mean the 18K? Or do you have 18K in the bank at the moment. It seems odd that the bank would offer 6.5 times your salary on a mortgage with no security. If this is the case I might consider buying myself!

audge

Salmon wrote:

It seems odd that the bank would offer 6.5 times your salary on a mortgage with no security. QUOTE]

Thats my point exactly! When I called it was merely on a fact finding mission, but if TSB are handing out mortgage deposits then I might buy sooner rather then later.

I don't have the deposit saved, and I would not have considered myself in a position to buy anytime soon.

I am totally confused now to be honest.

Salmon

I Know that they are giving 100% Mortgages at the moment, but I didnt think they would give 6.5 times earnings. I thought that 4 or 5 was closer the amount offered. Are you buying on your own or with someone else? Are you getting a guarantor for the loan?

audge

Well like I said, my call was just out of curiosity, I just wanted to find out what I was working toward.
I gave the guy all my details, educational background, current place of employment, where I am living at the moment, all that kinda thing, and he reckoned I could get a mortgage of €180k (I was amazed)
I also asked about what mortgage I could get if I bought with my boyfriend (together we have an income of €52k, and he offered a mortgage of €311k on that, which is closer to the 6times mark you mentioned)

Ideally, I want to buy alone, and at present, I don't have a guarantee.

Salmon

What mortgage advisor did you call? I might be interested in that myself!

Victor

TSB and a few other lenders will give 100% mortgages. You have to finance the deposit yourself until the contracts & mortgage are signed.

I suspect one could raise a personal loan to finance the deposit - I'm not sure how much you would get on €25k / 52k.

Salmon

when ye say deposit are ye talking about the €3-€5K deposit?

audge

Oh, right, so basically, I apply for a personal loan of 18k, then use this as the deposit for the mortgage?

But where is the banks security in all that?

I mean I have no problem doing that if it speeds up the process, but its very risky for the bank to give me a mortgage based on a deposit I didn't even save?

audge

Salmon wrote:

What mortgage advisor did you call? I might be interested in that myself!

James in rea.ie morgages. 01 676 1595

Salmon

I am a little confused! If it is a 100% Mortgage, you dont need to take out a personal loan to get the 18K. They should give you 100% of the mortgage. I think the deposit Victor is talking about is the booking deposit for the house! Around 3-5K or so. Is this correct!

MorningStar

They will say lots of things down the phone when you get to the real info the offer reduces. Go in with the details exactly and talk to somebody in person. I put it throuh the TSB calculator and sure enough they will give it out. But they will also give me a mortgage of over a million on my wage alone so there could be something wrong.

Although my dream house is on market

http://www2.myhome.ie/search/property.asp?id=253543&np=&devid

audge

Salmon wrote:

I am a little confused! If it is a 100% Mortgage, you dont need to take out a personal loan to get the 18K. They should give you 100% of the mortgage. I think the deposit Victor is talking about is the booking deposit for the house! Around 3-5K or so. Is this correct!

They call it a 100% mortgage, but you still need th 10% deposit, which they hold for security purposes for 6 months and then return to you. it is very confusing.

morningstar, that house is class! I am thinking of moving to the dublin commuter belt though, as I have seen beautiful 3 and 4 bed properties for in and around the 200k price.
You would pay upwards of 400k for similar properties in dublin

Salmon

Oh, I didnt realise that! Thats interesting!

audge

http://www.daft.ie/searchsale.daft?search=1&s[cc_id]=c8&s[a_id]=&s[mnp]=&s[mxp]=250000&s[bd_no]=3&offset=10&limit=10&search_type=sale&id=33293

http://www.daft.ie/searchsale.daft?search=1&s[cc_id]=c8&s[a_id]=&s[mnp]=&s[mxp]=250000&s[bd_no]=3&offset=10&limit=10&search_type=sale&id=33292

http://www.daft.ie/searchsale.daft?search=1&s[cc_id]=c8&s[a_id]=&s[mnp]=&s[mxp]=250000&s[bd_no]=3&offset=20&limit=10&search_type=sale&id=31683

http://www.daft.ie/searchsale.daft?search=1&s[cc_id]=c8&s[a_id]=&s[mnp]=&s[mxp]=250000&s[bd_no]=3&offset=20&limit=10&search_type=sale&id=31042

http://www.daft.ie/searchsale.daft?search=1&s[cc_id]=c8&s[a_id]=2385&s[mnp]=&s[mxp]=250000&s[bd_no]=4&limit=10&search_type=sale&id=26940

Victor

MorningStar wrote:

Although my dream house is on market

http://www2.myhome.ie/search/property.asp?id=253543&np=&devid

Those houses don't look right with flat roofs. Although they beat the ones that were in Ballyfermot / Baldoyle.

audge

Hey, I emailed James and asked him to clear up the confusion...

This is his reply

Dear Audrey,

Thank you your email, on a quick calculation based on your combined
salaries you should qualify for approximately €300- €310K, on your own
salary you will qualify for about €160K. There are ways of getting more
money for you but these figures will give you a rough indication.

Permanent TSB are providing a 100% mortgage to first time buyers, they
have separate criteria for this product, in order to qualify for this
product the property has to have at least 2 bedrooms, the primary
applicant has to be in continuous employment for the last 3 years and
the secondary applicant has to be in continuous employment for at least
one year, the product is only available for homeloans (i.e your main
residence not investment properties).

When purchasing a house the vendors will expect you to have a 10%
deposit and an official loan offer from your chosen lender offering you
the mortgage required, you will be given approximately 3 weeks to
prepare these two items from the day that you first give your booking
deposit.

For people who cannot put together the full 10% deposit,
Permanent TSB have put a system in place where they will give you the
10% deposit in the form of a personal loan to pay the deposit and when
you drawdown your full mortgage at a later stage the personal loan will
be cleared and you will only be making payments on your mortgage. it is
important to understand that you will be making payments to the
personal loan until you have drawn down your full mortgage.

the best thing I can do for you at this stage is to
take an application from you and shop around to see who is offering you
what, then I can discuss the best options available to you.


Kind regards

James

Salmon

That Clears up my Questions anyway! Seems Like a good system! Now to get my act together and get something sorted!

FreeAnd..

I have just been through the process of getting a 100% mortgage with PTSB and to be honest it was one of most painless processes that I have ever been through. Getting an overdraft for 200 pounds a few years back was by far more stress. It is great the way its done, you need no money up front just proof of earnings and the other criteria outlined above (3 years work etc). Once you have been approved and a valuation has been done on the property you can claim up to 10% of the price of the property for a deposit. On a 335k property our deposit was only 25,000 so they organised the personal loan over 10 years at 8.6% (just over 300 a month). This suits us fine as our property will not be ready for another year so we just pay that off each month until we begin to draw down on the mortgage, then the balance is absored into the mortgage and we only pay the mortgage repayments. I must commend PTSB for the good service but it always pays to have a good broker which we definitely had.

Salmon

How Many times your annual Salary do they give?

joejoem

audge wrote:

James in rea.ie morgages. 01 676 1595

Something simialar was said to me recently by Rea, when push came to shove they couldnt do it though. Dont put all your eggs in one basket, I got a far far better deal with another broker

audge

Decided to give James some personal info via email, so I could get a written reposnse

Hi James,

Thanks a million for getting back to me so soon. I am not entirely sure if I am in a position to apply for a mrtgage, but I would be very interested in giving it a go, afterall, nothing ventured, nothing gained.
My own circumstances are as follows:

24 years old Graduate ( Have two HND's and a BA Hons Degree)
Currently working as head of marketing department in an I.T company.
Am only in my first two months of full time salary based employment, but have had 8 years of continuous part time eomplyment whilst furthering my education.
Currently residing in the family home.
Have only one small loan (€2'500 - student loan)
Would be willing to rent additional rooms in what ever property I buy to help meet mortgage repayments.

I cannot think of anything else that would be relevant to an application, but if I am missing anything, then please do not hesitate to contact me.

Warm Regards,

Audrey

His reply

Hi Audrey,

As you are only in your new job for the last two months and your
previous employment was on a part-time basis I would really need to put
a full application to the lenders who offer the 100% mortgage and see
what they have to say.

you have a small loan that will be finished very soon, if you are looking to move on a property straight away I would
suggest clearing your loan as it can really reduce the amount you can
borrow on your mortgage.

If you are thinking of making an aplication I would like to get a copy of your contract for your new employment.

Regards

James

FreeAnd..

I got 4 times my salary. Could have got a bit more up to 5, which is pretty reasonable. Any more and you could be asking for trouble long term. I dont agree with the 8-10 times as some people have been saying.

dahooligan

I see that most of em insist on full time employment for 3 years +... does this mean that I've gotta bleedin wait ages now before I can be considered? I know that yer man is takin Audge's case into consideration (ie she has a degree and has been in permanent part time employment since she was born ).. but I've had to work sketchy jobs here and there whilst gettin my diploma. I know all they're looking for is job security etc but 3 YEARS?!

audge

Just to update... with regard to your questions as to what happens if you haven't been working full time for three years


Hi Audrey,

I just spoke to my account executive from Permanent TSB and I ran your
case briefly by him, he said in addition to your work contract he would
need to get your P60's for the last three years along with a copy of
your BA Hons Degree. What is key here is that you were working every
week in your previous job but not working a full week. Proof of your
degree simply shows that you have a promising career path.

regards

Salmon

I Suppose they take everything on a case by case basis! There are enough lenders out there so I think I'll contact them to see what they think! Let me know of any further developments audge! Best of luck!

old_lady

I told them I have a degree but I don't, didn't think for a second they would has to see the damn thing!

Salmon

oops!!! What ya gonna do?

LegacyUser

wouldn't advise going for a 180k mortgage .. plus borrowing the deposit of 18k with a salary of 25k.

Trust me ..