Query re: applying for mortgage approval in principle

howtolive

Hi,

Bit stumped on this one, any help would be fantastic. Looking at the mortgage calculators online / approval in principal information all ask for marital status/number of dependents. I have a few questions on same.

1) If a couple, planning to but not currently married, are looking for a joint mortgage on two incomes, should they apply as "cohabitant", "single" or "married"?

2) If one of a couple, no current plans to get married, applies as a single person and then X months later after mortgage drawdown gets married/cohabits, does this change anything with the approval or what legal issues would occur?

3) If a couple, planning to get married, seek a mortgage on one income does the applicant apply as a single person? Or is this incorrect and it should be a joint application even though both people are currently not married?

4) Regarding number of dependents, if a couple are looking for a joint mortgage, 2 incomes, but one is pregnant and due to go on maternity leave, do they leave number of dependents as 0 or change to 1 (as the number will be 1 some months down the line).

At present our status is simply both of us living at home but looking towards the future, no children expected, but it's not really clear from the information the banks provide whether applications are based on one's status at the time of application, or based on one's intention X months down the line, and we want to be above board with any application.

Any advice on the above would be great!

Cheers

howtolive

Also 5) To throw a curveball question in, if unable to qualify for a mortgage but had (example figures) 50k deposit and 30k in gifts, would the couple, single or joint, be able to apply for a personal loan and use this to become a cash buyer, negating the mortgage process entirely? If applying for a personal loan, is marital status/dependents considered, or just earnings?

Cheers!

RedPandaDan

howtolive wrote: »

Also 5) To throw a curveball question in, if unable to qualify for a mortgage but had (example figures) 50k deposit and 30k in gifts, would the couple, single or joint, be able to apply for a personal loan and use this to become a cash buyer, negating the mortgage process entirely? If applying for a personal loan, is marital status/dependents considered, or just earnings?

Cheers!

I wouldn't really be able to answer your other questions, but in relation to this one: If a bank turns you down for a mortgage, its for a reason. Whether that reason is good or bad is here nor there, but I don't think its prudent to just ignore their decision and then go for another source of money at a higher interest rate.

Woshy

howtolive wrote: »

Hi,

Bit stumped on this one, any help would be fantastic. Looking at the mortgage calculators online / approval in principal information all ask for marital status/number of dependents. I have a few questions on same.

1) If a couple, planning to but not currently married, are looking for a joint mortgage on two incomes, should they apply as "cohabitant", "single" or "married"?

2) If one of a couple, no current plans to get married, applies as a single person and then X months later after mortgage drawdown gets married/cohabits, does this change anything with the approval or what legal issues would occur?

3) If a couple, planning to get married, seek a mortgage on one income does the applicant apply as a single person? Or is this incorrect and it should be a joint application even though both people are currently not married?

4) Regarding number of dependents, if a couple are looking for a joint mortgage, 2 incomes, but one is pregnant and due to go on maternity leave, do they leave number of dependents as 0 or change to 1 (as the number will be 1 some months down the line).

At present our status is simply both of us living at home but looking towards the future, no children expected, but it's not really clear from the information the banks provide whether applications are based on one's status at the time of application, or based on one's intention X months down the line, and we want to be above board with any application.

Any advice on the above would be great!

Cheers

I cant answer your other questions because I am married and applied with that information (although for your first question the logical answer to me seems to be cohabitant as even if you don't live together now you will in the house you will buy). I can answer your question about if one of the joint applicants is pregnant.

My friend bought a house earlier in the year. When they got their mortgage approval she was heavily pregnant and they told this to the bank, they also told the bank she was unlikely to return to work afterwards. Even though she was pregnant their amount of dependents on their forms was 0. The bank (I think PTSB) said this didn't matter and gave them a mortgage based on them both working.

I know this because I am a stay at home mum and we struggled a bit getting a mortgage (despite having a large amount of cash) and myself and my friend discussed at length how frustrating their decision making process and policies are. They make the decision based on your circumstances at the time - which is of course understandable, none of us could see into the future. It was just funny because that worked in her favour and against ours (I plan on going back to work, husband has excellent earning potential etc). You can't prove your intentions to anyone though, they can only go on what your circumstances are at that time. The banks did say though that although our child is only a baby now, they have to factor in all the costs of raising him for the next 18 years into our ability to repay - so even though I know in ten years time things will be different the bank have to presume our earnings will be the same and we'll have an 11 year old to put through school and other costs.

I can't say if the banks you are applying to would treat your application similarly if you were in that sitatuion - just passing on my friend's experience.

Personally, I would get mortgage approval now before you decide to have a family etc. We had trouble getting mortgage approval as we have salary and a child, despite my husband earning a good salary. We have been approved for just over half of what we believe we have the ability to repay (based on how much we have been paying in rent/putting away every month). Luckily, that amount is fine for us and we are in the process of buying a house but if we weren't getting some help there is no way on earth we could ever buy a property. Some of the banks basically said I would need to go back to work. I was told if I worked and even earned 10,000 a year they would give us another 100,000 of a mortgage. That is absolutely crazy to me!

If I were you I would get joint approval based on your circumstances now and see what they come back with. Then you can make a decision on how to proceed. You don't have to go ahead with it nor use the whole amount.

howtolive

Hi All,

Thanks so much for the feedback.

@RedPandaDan: Understood, good advice, just trying to cover all bases and possible eventualities with the queries

@Woshy: Thank you very much for the detailed reply, really good information there, its crazy than an extra 10k a year would increase a potential mortgage by that much!

If anyone can assist on the other queries it'd be much appreciated.

Cheers!

MouseTail

My main and most important piece of advice to you is to move out of home and rent together for at least a year before considering purchasing together, however


1) If a couple, planning to but not currently married, are looking for a joint mortgage on two incomes, should they apply as "cohabitant", "single" or "married"?
Cohabitant


2) If one of a couple, no current plans to get married, applies as a single person and then X months later after mortgage drawdown gets married/cohabits, does this change anything with the approval or what legal issues would occur?

Once mortgage has been drawn down, bank don't give a hoot as long as repayments are met. The spouse does start to acquire rights though.


3) If a couple, planning to get married, seek a mortgage on one income does the applicant apply as a single person? Or is this incorrect and it should be a joint application even though both people are currently not married?

If they are cohabiting, banks will seek details of partner in order to assess risk.
If not cohabiting, banks wont care if you are planning to get married, you can be a single applicant.

4) Regarding number of dependents, if a couple are looking for a joint mortgage, 2 incomes, but one is pregnant and due to go on maternity leave, do they leave number of dependents as 0 or change to 1 (as the number will be 1 some months down the line).

0

howtolive

Hi Mousetail, thanks for the reply.

Might seem like a stupid question, but if the banks are only looking at current status (e.g. pregnant does not equal having a dependent) then if both sides are living at home/separate rather than currently cohabiting, should they put cohabitant on the application or single?

That would be a statement of future intent, much like planning to get married or going to have a child?

If cohabitant, should they not may as well put married if getting married pretty much in tandem with buying a house?

Sorry for the confusion!

MouseTail

You put your current status at the time of application. Bank do not care if you are getting engaged, planning on having 10 children and a menagerie of pets etc.

single if you are not cohabiting
cohabiting if you are cohabiting but not married.
married if you are married.