What are my chances of getting a mortgage?

leahyl

Hi guys,

Just looking for a general consensus here on what my chances are of getting a mortgage/how much I could get.

I'm 26 years old, single and in a full-time permanent job for 4 years. I'm on 27k per annum (gross)

I have around 25k in savings currently.

I have no loans to pay off.

Would I be likely to get a mortgage do you think? I'm not thinking of going for one tomorrow like but hopefully save a bit more and then if (or hopefully 'when') the house prices come down a bit more buy in the next year and a half - this is only all a plan in my head so it might not happen!

Thanks

daltonmd

In your situation I'd actually go ahead and apply for a mortgage - it will give you a run through of what you need to do when you actually do want one. You'll also get a better idea from the bank instead of differing opinions on here.............

Custardpi

Mortgage lending quite tight at the moment. I could be wrong but doesn't being rejected for a mortgage once affect your credit rating in the future? If so, taking that direction (even if not intending to complete it) might not be advisable at present.

The_Conductor

If you were insistent on going for a mortgage tomorrow- you would possibly qualify for between an 80 and 90% mortgage @ 4 times annual gross salary (they won't go over this multiple unless you have a guarantor or other extenuating circumstances that lower the risk for them).

So- you'd possibly qualify for a mortgage of 110k, on a property that would have a purchase price of at least 125k

If you're proposing to buy an apartment- depending on the lender- the income multiple may be as low as twice gross annual income........

killers1

Custardpi wrote: »

Mortgage lending quite tight at the moment. I could be wrong but doesn't being rejected for a mortgage once affect your credit rating in the future? If so, taking that direction (even if not intending to complete it) might not be advisable at present.

If you apply for a mortgage or any other loan for that matter the Bank will carry out an ICB check. All that will ever appear on your report is that 'X' bank made an enquiry on your credit status. This has neither a good, bad or indifferent effect on your future credit rating.

If you apply for a mortgage or loan with one bank and are declined, that bank will still happily assess any future application for you if your circumstances and the proposal have changed. The fact that you were previously declined will have no bearing on future applications made under a different set of terms.

killers1

smccarrick wrote: »

If you were insistent on going for a mortgage tomorrow- you would possibly qualify for between an 80 and 90% mortgage @ 4 times annual gross salary (they won't go over this multiple unless you have a guarantor or other extenuating circumstances that lower the risk for them).

So- you'd possibly qualify for a mortgage of 110k, on a property that would have a purchase price of at least 125k

If you're proposing to buy an apartment- depending on the lender- the income multiple may be as low as twice gross annual income........

Just to set you straight on what Banks ARE actually doing at the moment...

No bank works off a 4 X Salary Multiple.

If buying an apt it doesn't reduce the amount you will get based as a multiple of your income. Bank's have different lending criteria in relation to 1 bed apts. Eg AIB only lend 75% of the purchase price

The following loan to values are available from Bank's 92%, 90%, 85%, 80%. The main lenders, AIB, BOI, ICS, Ptsb are all giving 90%+. KBC are the only lender offering as low as 80% ltv to ftb's

killers1

leahyl wrote: »

Hi guys,

Just looking for a general consensus here on what my chances are of getting a mortgage/how much I could get.

I'm 26 years old, single and in a full-time permanent job for 4 years. I'm on 27k per annum (gross)

I have around 25k in savings currently.

I have no loans to pay off.

Would I be likely to get a mortgage do you think? I'm not thinking of going for one tomorrow like but hopefully save a bit more and then if (or hopefully 'when') the house prices come down a bit more buy in the next year and a half - this is only all a plan in my head so it might not happen!

Thanks

Hi Leahyl,

Based on your gross annual income you qualify for €130k based on 1 banks calculator and €120k based on another. The bank's whose calc indicates a figure of €120k would be willing to increase this figure to €150k if you have a proven repayment capacity for the amount required. The stressed repayments on €150k are €757.03 per month and this is what you would need to have a proven repayment capacity for. If you have been saving €1,000pm for the past 25 months you would be approved for €150k in the morning.

L1011

killers1 wrote: »

The following loan to values are available from Bank's 92%, 90%, 85%, 80%. The main lenders, AIB, BOI, ICS, Ptsb are all giving 90%+. KBC are the only lender offering as low as 80% ltv to ftb's

Surely you can actually borrow less than that if required?

If I was buying a 100k property I'd be looking for a 70% or lower mortgage (100k being 2.5x salary, 70k being less than 2x). Presumably a bank is not going to refuse that solely on it being lower than 80%?

Obviously there's every chance they'd refuse it for something else...

Ritchi

killers1 wrote: »

Hi Leahyl,

Based on your gross annual income you qualify for €130k based on 1 banks calculator and €120k based on another. The bank's whose calc indicates a figure of €120k would be willing to increase this figure to €150k if you have a proven repayment capacity for the amount required. The stressed repayments on €150k are €757.03 per month and this is what you would need to have a proven repayment capacity for. If you have been saving €1,000pm for the past 25 months you would be approved for €150k in the morning.

Hi Killers,

Just wondering if you'd mind doing something similar for my situation. We have a combined income of 74k, savings of 16k, and currently saving 1k a month(as well as 1k in rent). Both permanent jobs, no loans.

We're hoping to get a mortgage of about 200k in a few months time when we have the 10% deposit saved. Would you think we'd be in with a shout for it. Or will we need to save a while longer?

killers1

MYOB wrote: »

Surely you can actually borrow less than that if required?

If I was buying a 100k property I'd be looking for a 70% or lower mortgage (100k being 2.5x salary, 70k being less than 2x). Presumably a bank is not going to refuse that solely on it being lower than 80%?

Obviously there's every chance they'd refuse it for something else...

These are the maximum loan to values the bank will offer. Obviously the more money you can put towards the purchase price the better!

E.g Your buying a house for €200k & have 20k savings. A bank that offers 90% (€180k) or 92% (€184K) are options for you whereas a bank whose max ltv is 80% (i.e. €160k) is no going to be of any use to you as €160k + €20k = €180k but the house costs €20k more than that. In the same scenario if you have €80k savings and only need to borrow €120k you can go to all of the banks because the loan to value is within all their maximum criteria....hope this clarifies!!!

killers1

Ritchi wrote: »

Hi Killers,

Just wondering if you'd mind doing something similar for my situation. We have a combined income of 74k, savings of 16k, and currently saving 1k a month(as well as 1k in rent). Both permanent jobs, no loans.

We're hoping to get a mortgage of about 200k in a few months time when we have the 10% deposit saved. Would you think we'd be in with a shout for it. Or will we need to save a while longer?

Hi Ritchi,

How long are you saving €1kpm? Is it the last 16 months or did you get a lump sum at some stage? How long have you been renting @ 1k pm and is it paid directly via your bank account by Standing Order or do you have a lease if you pay in cash?

Ritchi

killers1 wrote: »

Hi Ritchi,

How long are you saving €1kpm? Is it the last 16 months or did you get a lump sum at some stage? How long have you been renting @ 1k pm and is it paid directly via your bank account by Standing Order or do you have a lease if you pay in cash?

Savings are built up over the past two years maybe, I set up a savings account and 1k is taken out regularly for the past 4 or 5 months, before that it was just transferring money when ever, but most of the time it would have been close to 1k a month.

Rent is paid by a manual transfer from my account every month.

killers1

Ritchi wrote: »

Savings are built up over the past two years maybe, I set up a savings account and 1k is taken out regularly for the past 4 or 5 months, before that it was just transferring money when ever, but most of the time it would have been close to 1k a month.

Rent is paid by a manual transfer from my account every month.

Ritchi you're in a strong position. You easily qualify based on combined income and have an evident repayment capacity via rent & savings. You will need to have your deposit + funds for Stamp Duty legal fees etc.. but once you have sufficient monies saved you're in a good position to apply.

leahyl

killers1 wrote: »

leahyl wrote: »

Hi guys,

Just looking for a general consensus here on what my chances are of getting a mortgage/how much I could get.

I'm 26 years old, single and in a full-time permanent job for 4 years. I'm on 27k per annum (gross)

I have around 25k in savings currently.

I have no loans to pay off.

Would I be likely to get a mortgage do you think? I'm not thinking of going for one tomorrow like but hopefully save a bit more and then if (or hopefully 'when') the house prices come down a bit more buy in the next year and a half - this is only all a plan in my head so it might not happen!

Thanks

Hi Leahyl,

Based on your gross annual income you qualify for €130k based on 1 banks calculator and €120k based on another. The bank's whose calc indicates a figure of €120k would be willing to increase this figure to €150k if you have a proven repayment capacity for the amount required. The stressed repayments on €150k are €757.03 per month and this is what you would need to have a proven repayment capacity for. If you have been saving €1,000pm for the past 25 months you would be approved for €150k in the morning.

Thanks Killers1 - I have been saving 700pm for the last 2 years or so - 500 into bank and 200 into credit union. I don't think I could manage a grand a month! I had money that I had just built up in my savings account since I started working (mainly cos I didn't really go out drinking etc much when I was in college/early 20's - sensible me :-P) so I moved that to another account and then just saved the rest over the last 2 years. I also have some money in my savings acc that could also go towards deposit if needs be.

Thanks for your advice :-)

killers1

leahyl wrote: »

Thanks Killers1 - I have been saving 700pm for the last 2 years or so - 500 into bank and 200 into credit union. I don't think I could manage a grand a month! I had money that I had just built up in my savings account since I started working (mainly cos I didn't really go out drinking etc much when I was in college/early 20's - sensible me :-P) so I moved that to another account and then just saved the rest over the last 2 years. I also have some money in my savings acc that could also go towards deposit if needs be.

Thanks for your advice :-)

Hi Leahyl,

Congrats on your sensibility! I wish I had that discipline in my 20's! You'd get €135k in the morning!

leahyl

killers1 wrote: »

leahyl wrote: »

Thanks Killers1 - I have been saving 700pm for the last 2 years or so - 500 into bank and 200 into credit union. I don't think I could manage a grand a month! I had money that I had just built up in my savings account since I started working (mainly cos I didn't really go out drinking etc much when I was in college/early 20's - sensible me :-P) so I moved that to another account and then just saved the rest over the last 2 years. I also have some money in my savings acc that could also go towards deposit if needs be.

Thanks for your advice :-)

Hi Leahyl,

Congrats on your sensibility! I wish I had that discipline in my 20's! You'd get €135k in the morning!

I know I don't know how the hell I built it up - it's not like I didn't go on holidays, buy clothes and other luxury items! It's only of recent years that I've been going out more!

135k? Sounds good enough! I suppose I'd better keep saving - maybe up the amount saved!

killers1

leahyl wrote: »

I know I don't know how the hell I built it up - it's not like I didn't go on holidays, buy clothes and other luxury items! It's only of recent years that I've been going out more!

135k? Sounds good enough! I suppose I'd better keep saving - maybe up the amount saved!

Fair play to you! A loan amount of €135k gives you a purchase price of €160k taking your savings into account...just need to save now for your stamp duty, legal fees & fit out & you're in a good position!

leahyl

killers1 wrote: »

leahyl wrote: »

I know I don't know how the hell I built it up - it's not like I didn't go on holidays, buy clothes and other luxury items! It's only of recent years that I've been going out more!

135k? Sounds good enough! I suppose I'd better keep saving - maybe up the amount saved!

Fair play to you! A loan amount of €135k gives you a purchase price of €160k taking your savings into account...just need to save now for your stamp duty, legal fees & fit out & you're in a good position!

How much would stamp duties/legal fees cost?

shangri la

I thought the stamp duty was abolished. Must read more into it.

leahyl

shangri la wrote: »

I thought the stamp duty was abolished. Must read more into it.

I think there used to be no stamp duty for first time buyers but they brought in back in in the last budget

killers1

shangri la wrote: »

I thought the stamp duty was abolished. Must read more into it.

1% stamp duty up to €1M & 2% on any portion above this irrespective of whether you're a first time buyer or not