AIB and their Mortgage criteria.

gazzer

Myself and my partner sold our house a year ago and have been renting ever since. A couple of houses near where we are renting and have caught our eye. One in particular which is a 4 bedroom detached house (2300 sq feet) on an acre of land is really really nice. It has an asking price of 230.000 (Cavan area)

We decided to go with a mortgage broker just to see if we could get mortgage approval. We dont even know if we will buy yet as I still reckon prices have a bit to fall but at the same time if we saw THE house I would like to have the mortgage approval in place.

So we applied for a mortgage of 215,000. We earn 90,000 a year between us and we have 45,000 in savings. We have gotten approval from a couple of banks/building societys but were refused by AIB.

The reason that AIB gave for refusing us is that they were unsure if we would have the capacity for the repayment. The repayments would have been roughly 1000 a month. We are currently paying 720 a month in rent. However for the 5 years up until we sold our house we were paying 1200 a month on our mortgage so even though we had less money then we were meeting our mortgage committments. The broker we were dealing with said that AIB are just rediculous to deal with and that they are lending to nobody.

Anybody else have dealings with AIB?

ntlbell

I know it's not what you're looking for but I'm curious why you care?

other banks are willing to give you the money

with that deposit which is pretty big and it's obvious you can afford the payments between you that there is definitely another reason AIB don't want to do business with you and lots like you but they're giving you a cock n bull story?

go to one of the other banks and forget about AIB it seems you're taken the refusal a bit personally.

gazzer

ntlbell wrote: »

I know it's not what you're looking for but I'm curious why you care?

other banks are willing to give you the money

with that deposit which is pretty big and it's obvious you can afford the payments between you that there is definitely another reason AIB don't want to do business with you and lots like you but they're giving you a cock n bull story?

go to one of the other banks and forget about AIB it seems you're taken the refusal a bit personally.

You are right. I should'nt care because we have approval anyway. To be honest I am just baffled by their reason for not approving the loan.

wandiwar

Hi we were in the same boat recently. Got refused by AIB cos 'the regulator is watching us very closely' (that was the reason we got). We do all our banking with them etc..... Went to our branch cos we had no idea why exactly we were refused.

He reapplied for us and eventually got us approval after fighting our case. He said they are just refusing everything for the silliest reasons.

It's worth a while just going in to talk to the branch manager. Ours was brilliant. Took him a few weeks but gout us sorted!!!

D3PO

gazzer wrote: »

You are right. I should'nt care because we have approval anyway. To be honest I am just baffled by their reason for not approving the loan.

unless you are going to get a better interest rate off them i wouldnt worry about it. Some banks are "Open Closed for Business"

ntlbell

the bizarre thing is I've had two or three calls from AIB in the last year or so

asking me am i ok for everything and is there anything they can do for me..

very odd!

D3PO

ntlbell wrote: »

the bizarre thing is I've had two or three calls from AIB in the last year or so

asking me am i ok for everything and is there anything they can do for me..

very odd!

Same here that said I think that really translates to.

"We have lent you a lot of money just checking to make sure were not gonna leave us up the creek without a paddle "

ntlbell

D3PO wrote: »

Same here that said I think that really translates to.

"We have lent you a lot of money just checking to make sure were not gonna leave us up the creek without a paddle "

I oue em shag all I think they just wanted me to get up to my arm pits in it again

cmd25

Hi, we are kind of in the same posistion with the AIB. I applied for mortgage myself and my partner with the AIB. They were posting out letters for my partner to apply that he would qualify for €170,000 on his own. When we went to apply together they then sent out a letter refusing us. We have a combined income of €46,800 per annum. The only loan we have is €8,000 and savings of €5,000. Parents were giving us deposit as a gift of 12,000 for a house which we wanted to purchase for 150,000 so basically all we needed was 147,000 from the bank. We are so disappointed because the bank had our hopes up. The house is a builders finish and was currently €380,000 before the recession. Has anyone any help or advice for us or in the same posistion.

Stheno

cmd25 wrote: »

Hi, we are kind of in the same posistion with the AIB. I applied for mortgage myself and my partner with the AIB. They were posting out letters for my partner to apply that he would qualify for €170,000 on his own. When we went to apply together they then sent out a letter refusing us. We have a combined income of €46,800 per annum. The only loan we have is €8,000 and savings of €5,000. Parents were giving us deposit as a gift of 12,000 for a house which we wanted to purchase for 150,000 so basically all we needed was 147,000 from the bank. We are so disappointed because the bank had our hopes up. The house is a builders finish and was currently €380,000 before the recession. Has anyone any help or advice for us or in the same posistion.

You probably need to clear that loan of €8000 and show an increased amount of savings. Repayments on the loan are what? €250 per month? That will be factored in against your net income.

Sofiztikated

cmd25 wrote: »

Hi, we are kind of in the same posistion with the AIB. I applied for mortgage myself and my partner with the AIB. They were posting out letters for my partner to apply that he would qualify for €170,000 on his own. When we went to apply together they then sent out a letter refusing us. We have a combined income of €46,800 per annum. The only loan we have is €8,000 and savings of €5,000. Parents were giving us deposit as a gift of 12,000 for a house which we wanted to purchase for 150,000 so basically all we needed was 147,000 from the bank. We are so disappointed because the bank had our hopes up. The house is a builders finish and was currently €380,000 before the recession. Has anyone any help or advice for us or in the same posistion.

Your maths seem to be a bit off.

House €150,000? So deposit of €12,000 does not equate to a loan of €147000. Thats probably why you were refused. You would need at least 85% LTV, so you'd be looking for a mortgage for €127500.

It matters not what the house was valued at "before the recession" as that has feck all bearing on what the house is worth now.

cmd25

Sofiztikated wrote: »

Your maths seem to be a bit off.

House €150,000? So deposit of €12,000 does not equate to a loan of €147000. Thats probably why you were refused. You would need at least 85% LTV, so you'd be looking for a mortgage for €127500.

It matters not what the house was valued at "before the recession" as that has feck all bearing on what the house is worth now.

Sorry, yeah we applied for 160,000 but auctionner reckons the seller would accept 150,000. They will give us €147,200 and we have to put up a deposit of 12,800. They lend 92% motgage as we are FTB. Well thats what they said we could have and then we got a letter refusing us and they said that are not obliged to have to give us a reason.

cmd25

Stheno wrote: »

You probably need to clear that loan of €8000 and show an increased amount of savings. Repayments on the loan are what? €250 per month? That will be factored in against your net income.

I am paying €400 pm on my car loan and saving €200pm. These payments don't neccesarily have to be this high but we moved out of rented accomadation recently to try save and i started paying off more on my loan. This loan is just in my own name, my partner has no loan and he got a letter for just him asking if he wanted a mortgage so don't know why they refused.

gurramok

Clear that car loan. What was the max that AIB offered you? 147k?

MistyCheese

I've never personally dealt with AIB but a friend of mine has banked with them for 17 years and has always been refused a loan/mortgage/overdraft.

Stheno

cmd25 wrote: »

I am paying €400 pm on my car loan and saving €200pm. These payments don't neccesarily have to be this high but we moved out of rented accomadation recently to try save and i started paying off more on my loan. This loan is just in my own name, my partner has no loan and he got a letter for just him asking if he wanted a mortgage so don't know why they refused.

Your car loan will have affected the joint loan application.

Cavehill Red

MistyCheese wrote: »

I've never personally dealt with AIB but a friend of mine has banked with them for 17 years and has always been refused a loan/mortgage/overdraft.

Why? Why stay with a bank that won't give you an overdraft after 17 years???

MistyCheese

He's very lazy. He has said he's changing banks, a decision I fully agree with, as you say, why stay with a bank that does nothing for you? But the bank he is moving to, he selected them because "there's a few around where I work."

Like I said I'm all for him changing banks to get himself a better deal but I wish he'd choose his bank on the criteria "What can this bank do for me?"

Still, he hasn't even gone ahead with the switch yet. I could have the same story to tell a year or two down the line.

Cavehill Red

If he's been lodging pay into the bank, he's probably made them a small fortune over the years with no access to any credit whatsoever to show for it.
Madness!

astrofool

AIB are in the sh*t, the absolute sh*t, and if it weren't for Anglo being even worse, everybody would be talking about having to bail out AIB for the umpteenth time. They are only going to loan to someone with a very high LTV ratio, or if you have the money in the bank already.

While Anglo won't exist as a bank in real terms in the next few years as they get it under control, AIB will be allowed to keep operating, and we'll be bailing the f*ckheads out again in 10 years time.

cmd25

gurramok wrote: »

Clear that car loan. What was the max that AIB offered you? 147k?

They sent a letter saying that there is 170,000 available to my partner for a mortgage but then when we applied for it they refused us. We were very confused and frustrated as they were the ones who wrote him. They get your hopes up and then let you down with a bang! :mad:

cmd25

Does anybody know what Ulster Bank are like to deal with for mortgages as someone has recommended them to me? Has anyone being accepted while also having other loans?

cmd25

Stheno wrote: »

Your car loan will have affected the joint loan application.

Do you reckon that you have to have no other loans now before they will give mortgages ?

spockety

cmd25 wrote: »

They sent a letter saying that there is 170,000 available to my partner for a mortgage but then when we applied for it they refused us. We were very confused and frustrated as they were the ones who wrote him. They get your hopes up and then let you down with a bang! :mad:

Sounds misleading, and while there may have been small print on the 'offer' I would say still worth reporting to the financial regulator, the ombudsman, or the consumer association.

Head The Wall

They probably based 170k on the salary they see going into the bank, it's only a guideline. The fact that he has a wive with a loan, more outgoings than they expected would affect all these values.

It's usually recommended that you have nothing outstanding unless you have a wage well above the mortgage and meet the LTV ratio

Rooneysdaman

<<They are only going to loan to someone with a very high LTV ratio, or if you have the money in the bank already.>>


Without getting into figures, I have a 50% downpayment to make, no other debt and a steady (low-paying but adequate) job. Have been refused by BOI, AIB and KBC on the grounds that I have been in job less than 1 year. Totally discounting that current job is a continuation of the career I had in the US for the past 15 years. Very frustrating.

I have zero expectation of the answer changing when the one-year point is reached in November. They will have a different excuse by then.

Dr. Dodger

I think before you go applying for any mortgage now in the current climate, you should be debt free. I have heard (correct me if I'm wrong) that for every €1000 of debt, they take €10,000 off the mortgage amount they will offer you. You're other half was offered €170,000 because he had no debt. I would say when the joint application went through, your debt becomes his debt & so they've rejected you.

Get rid of the debt asap. I don't think it makes sense to have savings of €5k when you owe €8k and paying interest. Completely counter productive when looking for a mortgage. Just my opinion.

The_Conductor

Dr. Dodger wrote: »

I think before you go applying for any mortgage now in the current climate, you should be debt free. I have heard (correct me if I'm wrong) that for every €1000 of debt, they take €10,000 off the mortgage amount they will offer you. You're other half was offered €170,000 because he had no debt. I would say when the joint application went through, your debt becomes his debt & so they've rejected you.

Get rid of the debt asap. I don't think it makes sense to have savings of €5k when you owe €8k and paying interest. Completely counter productive when looking for a mortgage. Just my opinion.

I'd echo what Dr. Dodger has said above.
Any debt at all- massively reduces the amount they are willing to lend you.
Also- irrespective of when the principle on that debt may be repaid in full- it gets added to the max monthly repayment calculation the bank use (which is 35% of NET pay towards servicing mortgage and other outstanding debt). So- even a relatively small car loan can have a totally disproportionate impact on a mortgage application.

In short- clear all outstanding debt- absolutely everything- credit cards, car loans, overdrafts, term loans etc- clear the whole lot of them before you apply- and then work your calculation around what 35% of your NET income is- and what 85% of the LTV of the property comes to.

Some of the lending institutions are offering 92% loans to first time buyers- in theory- in practice, despite the advertising- they are far more likely to agree to a mortgage with an LTV of below 85% than a 92% loan (on current trends a 92% loan would be in negative equity within a year!!!)

Clear any debt- generate a reasonable amount of savings (I'd say at least 15% of the price of the property), and then apply.

The_Conductor

cmd25 wrote: »

Does anybody know what Ulster Bank are like to deal with for mortgages as someone has recommended them to me? Has anyone being accepted while also having other loans?

Ulster Bank will probably give you a mortgage offer- with other outstanding loans- providing it falls within the total of 35% NET income to make repayments, and you are a pre-existing Ulster Bank customer. They will most probably not offer a mortgage to a new customer with outstanding loans.

EBS and Ulster Bank are probably the two most lenient institutions out there at present (they started negative equity mortgages in April)- however they are not actively seeking new customers (and Ulster Bank as part of RBS- actually appears to be running down its Irish loan book, according to their last market update).

S.

MuffinsDa

cmd25 wrote: »

Do you reckon that you have to have no other loans now before they will give mortgages ?

Yes, absolutely! Any mortgage advisor would tell you that.

MuffinsDa

cmd25 wrote: »

Does anybody know what Ulster Bank are like to deal with for mortgages as someone has recommended them to me? Has anyone being accepted while also having other loans?

Don't bother with them, they are not interested in the Irish Mortgage market anymore. Their rates is a reflection of that and I've been personally told the same by one of their employees who was supposed to advise me on a mortgage application earlier this year.

Sparky_Larks

Got a Mortgage a year ago with AIB

I had just started a new job and was on probation. Once I had a letter saying I was finished my probation, had no other problems.

I had no other loans, no car ,credit card even overdraft wasn't being used.
Had the deposit in the bank, it had been saved over the previous few years

Intrestingly before I had the letter they would give my wife less then they would have given her on a single application. The reasoning was that if I lost my job she would have to support me.

jackal

We had the same frustrating experience with AIB. Friendly in branch mortgage staff led us on a merry dance, put all the figures into computer and computer says yes, even got to the stage of opening current accounts for us for deposit of pay etc. Then got the phone call... Because herself is unemployed they wont offer a mortgage - even though the repayments were under 35% net of income.

No lower offer, no nothing. We are not in a position to supply you with a mortgage at this time.

I was not really committed to buying anything anyway (this was spring 2010) so it was not like we missed out on a 'dream house', but going from approved for 300k+ to not approved for anything was a bit shocking.

With any of the banks the moral of the story - and I have been told this by a relation who works in the mortgage dept of a bank - is that the local branch mortgage advisor/bank manager have ZERO influence now, so do not get your hopes up based on what you hear in branch. Your application gets sent off to HQ for a credit committee to decide on, and as people are pointing out, they are looking for excuses not to give mortgages at the moment.

Treehouse72

I do hope that everyone contributing to this thread realises that the subject of the thread is not actually mortgage funding. It's something else. Presumably I don't need to join those dots.

spockety

jackal wrote: »

We had the same frustrating experience with AIB. Friendly in branch mortgage staff led us on a merry dance, put all the figures into computer and computer says yes, even got to the stage of opening current accounts for us for deposit of pay etc. Then got the phone call... Because herself is unemployed they wont offer a mortgage - even though the repayments were under 35% net of income.

No lower offer, no nothing. We are not in a position to supply you with a mortgage at this time.

Is that to suggest that AIB are no longer willing to provide mortgages to single income families?

bugler

Refusals seem rampant at the moment. To be outright refused is better than to be led on thinking you'll get the mortgage before having the plug pulled later.

Unfortunately the banks have resorted to deception to make it seem they're lending (see BoI's marketing). Better transparency in this process would actually help to return the market to something resembling a functioning position. Instead we have banks pretending they're lending, and customers fooled into thinking they're buying.

jackal

spockety wrote: »

Is that to suggest that AIB are no longer willing to provide mortgages to single income families?

Well, we are not a "family" as such, not married, no kids. The rationale they gave us, which was not put in writing, was that because she was not working, I would have to support her. They must have a figure somewhere for this that they throw into calculations. With this unknown monthly amount and their more rigorous stress test, they said that it pushed me over the acceptable % of income, but were not specific.

They said to come back when we are both working full time. I could always apply on my own (it was suggested by the branch guy), but I thought that lies, inflated salary statements and optimism got plenty of the people in this country into a mess, so I will leave it.

Incidentally, BOI would give us some money, so I guess you could say they "approved us" like the 100 per day in their adverts, but what we asked for was twice what they approved us for, so yeah thanks but no thanks.

The_Conductor

What income multiple were you looking for- out of interest?
They are supposed to working off a strict 3.5 times primary and twice secondary.......

spockety

If you're not married, and your partner isn't contributing to the mortgage, I don't understand why AIB are taking her into account at all. For all intents and purposes, on paper she is a stranger to you.

Or were you trying to get a sum of money from AIB that would reflect 2 people working?

windsurfer99ie

My own experiences with AIB may be a bit dated but I'd recommend sitting down with a Manager and being prepared making a case as to why you are a good risk :

Back in 2003 I applied to AIB for about 60% of the value of a home and was getting nowhere. I assumed they knew about my previous home loan with them, that I had substantially paid it off, had no other debts etc. However, when I sat down with them, I realised that they did not know anything about my financial / employment history other than what was actually written on the form despite having been involved with them for a good number of years. When I sat down and made my case the Manager approved the loan straight away. I'd recommend this approach and I do think AIB mortages are good value if you have a relatively low LTV.

The_Conductor

spockety wrote: »

If you're not married, and your partner isn't contributing to the mortgage, I don't understand why AIB are taking her into account at all. For all intents and purposes, on paper she is a stranger to you.

Or were you trying to get a sum of money from AIB that would reflect 2 people working?

I think it was a joint application- which would explain the partner and their income, or lack thereof, being added into the equation.

jackal

smccarrick wrote: »

I think it was a joint application- which would explain the partner and their income, or lack thereof, being added into the equation.

Correct, it was a joint application. I may have had more success with the application as a single applicant, because as a previous poster says, on paper we are not connected. However there was an issue of a gift/slice of equity coming from her side, so I was unsure how to explain that one, (and there would have been a messy tax situation if it were given to me).

FYI the amount we were seeking was more like 5 times gross income.

Jo King

windsurfer99ie wrote: »

Back in 2003 I applied to AIB for about 60% of the value of a home and was getting nowhere.

2003! That was a different planet.

irlrobins

windsurfer99ie wrote: »

When I sat down and made my case the Manager approved the loan straight away. I'd recommend this approach ..

I had a similiar experience with AIB last year. I met with a mortgage advisor and he took some basic details and fed them into his mortgage calculator. The amount he offered was not realistic in my opinion, and didn't take into account several factors, such as a lower LTV, proven track record of saving, etc. So I pushed on this and a manager got involved. They requested more info from me (such as proof of savings, bank statements etc). Left it with them for a day and they came back with an amount that was more appropriate.

So it never hurts to push for a better deal, jsut make sure you can back your argument up with hard evidence. And of course, don't go beyond your means!

Goldenegg

Myself and my fiance were approved for a mortgage with aib last week. We have a joint income of 75k,i have a loan with 13k left over the next 2years.we realise we were extremely lucky! But would recommend to stay away from credit cards etc,try not to build up much debt. We approached our bank manager to talk about mortgage application and stated our case.

JoeyJJ

Goldenegg wrote: »

Myself and my fiance were approved for a mortgage with aib last week. We have a joint income of 75k,i have a loan with 13k left over the next 2years.we realise we were extremely lucky! But would recommend to stay away from credit cards etc,try not to build up much debt. We approached our bank manager to talk about mortgage application and stated our case.

Would you mind telling us how much you were approved for? and the LTV is it 92%?

royaler83

JoeyJJ wrote: »

Would you mind telling us how much you were approved for? and the LTV is it 92%?

And also how much savings have you as this would be taken into consideration also

Goldenegg

royaler83 wrote: »

And also how much savings have you as this would be taken into consideration also

As we are FTB we were approved for 92% with savings of a little over 14k. The rest of the deposit is coming from both sets of parents. The house was for just under 230k.