Mortgages

liliq

Hi all... not much of a poster in this forum, but I'm hoping that I might be able to get some info...

My fiancee and myself are in the process of looking to buy a house and we're applying for a mortgage- we found a house we really like and want to put an offer on it. There doesn't seem to be a huge amount happening with the house- it's been on the market a couple of months, asking price has dropped a number of times etc. so we're not under pressure in that sense... but our lease is up in 10 weeks and the landlord has new tenants lined up, so we need to know where we'll be going!!

So- we went into the bank late last week, and talked to one of the people in there about applying for a mortgage and what's involved etc. We have a fairly decent deposit saved (over 20%).
Now- we're looking for slightly over what would usually be considered as a loan by the bank- they calculated 4.75 X our combined incomes- we're looking for just under 5 X in order to be able to make a realistic offer on this house. My Dad is offering to go guarantor (sp?) and the bank are saying this will make up for the difference in amount we're asking for.(makes me feel like a child though!) The loan to value ratio and our ability to pay are all good it seems.

The problem is- it's a week since we put in the official application, and despite having been told that we'd hear back from them by Monday evening/ Tuesday morning with a decision, we have heard nothing! The guy we've been dealing with seems like a good guy, but he's telling us that he'll call at x or y time, and keep us updated, and he doesn't. We try to call/ email him, and get no response. He hasn't once responded to a voice mail I've left.

My question is- is it the case that the bank are putting the "open" signs on their doors, but are just putting on a show and when push comes to shove, giving out no loans? Or has anyone actually been given a mortgage recently?
Is this guy just being ignorant in not responding to emails or voice mails, or is this the way the banks are fobbing people off?

ShadowHearth

hmmm.. i got approved for morgage just a few weeks ago. i presume my morgage is way smaller then yours.

i went in to bank and got all documantation. i was told i will know the answer in 10 working days. i called after it expired and i lady said a huge sorry for not contacting me last day and that main bank in dublin asked more info on me. she called me next day and said good news.

its very very weird that you cant contact the fella you deal with. which bank is it? the first person i dealed with was a fool, so on next meeting i asked someone else to deal with my case ( that second person took all documentation and got us morgage), it was mananger in bank, super helpfull.

go in bank and ask to talk someone from higher.

snowey07

Ive done all my communication by email so ill have a record of whats being asked for etc so I could say " as you stated below I would have a reply by x"

How ever i found they are lovely when you are asking for money but not so nice when you actually try to get it. My conatct in the bank has gone from " oooh what a lovely house, its so exciting " to emails/ messages that dont even say hello

Apart from the people on boards i have heard of no mortgages being drawdown. My EA says any sales they have had came from KBG and BOI.

best of luck

lainey316

4.75x combined is very high - especially with an ESB rate hike coming. Bank may be reconsidering the multiple.

Lyn256

Looking for 5 times your combined income strikes me a being bit high. That's a lot of money to come up with every month and with interest rates heading upwards and house prices falling. I'd think long and hard about it.
you'd be better off looking for a maximum of 3.5 times your combined salary-you don;t know what the future will bring-children/job losses/interest rates. See what you can get for that money or rent for another year and see where house prices are then

Minier81

liliq, is the bank you are dealing with one of the ones that is actually lending at the moment? As far as I am aware it is really only BOI, KBC and AIB (kind-of) who are actually giving mortgages.

f9710145

I'd also be very wary of 5 times your combined income. What happens if one of you loses a job or gets sick, or have a surprise addition (which could be twins or a sick child) which would leave you down a chunk of income.
What proportion of your income will be going on mortgage every month?

D3PO

OP your in cloud cuckoo land if you think any bank will offer you 5x your combinded salaries.

Besides the fact that is completly and utterly irresponsible on your behalf. This isnt 2006 anymore.

OMD

liliq wrote: »

Hi all... not much of a poster in this forum, but I'm hoping that I might be able to get some info...

My fiancee and myself are in the process of looking to buy a house and we're applying for a mortgage- we found a house we really like and want to put an offer on it. There doesn't seem to be a huge amount happening with the house- it's been on the market a couple of months, asking price has dropped a number of times etc. so we're not under pressure in that sense... but our lease is up in 10 weeks and the landlord has new tenants lined up, so we need to know where we'll be going!!

Considering you don't have mortgage approval yet, you are very unlikely to have moved into a new house in that time. You may need to make alternative arrangements. Make sure you have life assurance in place ASAP as it can sometimes drag for weeks.
People are right about the 5 times income issue (even if some are over the top in their reaction to it). Make sure you are happy with your finances and plan for interest rate rises.

Marcusm

Are you and your partner in jobs where you have strong expectations of high salary increases over the next 5 years, such as being trainee professionals with guaranteed future jobs (not that I think this exists). If not, I think you are being very adventurous in what you are seeking and likely putting your parent's financial wellbeing at significant risk as well as your own. I don't know what sort of property you are looking at but unless it is a spectacular bargain (think if Derek Quinlan's daughter seeking 20% of what she paid for her house) then I think you are storing problems for the future. Unless there is a dramatic increase in the economy, a large number if forced sales starting in a year or so will substantially dePress prices and lending rates will rise significantly when banks begin to be weaned off ECB support and have to bear a true cost of funds.

liliq

Thanks for all the responses... A lot to think about.
We haven't heard anything back yet, so still waiting... hopefully next week!

We'd taken a lot of what was said in the comments here into consideration before we applied for the mortgage, but definitely more food for thought!