Mortgage advice

Boyne1919

Hi, I'm currently looking to buy a house on my own and have had a meeting with my bank for mortgage approval. Now I know I need to try different banks but I'd like opinions if possible on whether you think the loan amount I was offered is reasonable.

I'm in my late twenties and am earning near on €25,000 per year inc bonuses. I've been saving a long time with buying a house in mind. I've managed to amass savings of about €115,000 and have demonstrated that I can save well over 50% of my monthly wage on an on-going basis.

I had a house in mind around the 170,000 - 180,000 region and the loan amount I was offered was €70,000. Well less than 50%. Unfortunately it seems being clever with savings mean nothing and unless you're buying with a partner etc the loan amount isn't going to be sufficient.

o1s1n

Boyne1919 wrote: »

Hi, I'm currently looking to buy a house on my own and have had a meeting with my bank for mortgage approval. Now I know I need to try different banks but I'd like opinions if possible on whether you think the loan amount I was offered is reasonable.

I'm in my late twenties and am earning near on €25,000 per year inc bonuses. I've been saving a long time with buying a house in mind. I've managed to amass savings of about €115,000 and have demonstrated that I can save well over 50% of my monthly wage on an on-going basis.

I had a house in mind around the 170,000 - 180,000 region and the loan amount I was offered was €70,000. Well less than 50%. Unfortunately it seems being clever with savings mean nothing and unless you're buying with a partner etc the loan amount isn't going to be sufficient.

But 115,000 + 70,000 is what you're looking for house price wise isn't it?

Congrats on the saving by the way, that's amazing on 25k

Boyne1919

o1s1n wrote: »

But 115,000 + 70,000 is what you're looking for house price wise isn't it?

Congrats on the saving by the way, that's amazing on 25k

Thanks, yes that's what I'm looking for but didn't want to use all my savings on the house. Thought I might get a better percentage of a loan.

mickman

o1s1n wrote: »

But 115,000 + 70,000 is what you're looking for house price wise isn't it?

Congrats on the saving by the way, that's amazing on 25k

indeed. how on earth can you save that much

D3PO

your earning less than 25k some of which is a bonus. What exactly did you expect them to offer you ?

Just becasue you have saved an extraordinary amount of money doesnt mean they should thrown an extraordinary amount of money at you.

I can only assume you have ammased these savings becaue you live at home and live a very frugal lifestyle.

The facts are home ownership costs are more than just a mortgage.

Theres house insurance, life assurance, water tax, property tax, utility bills ESB, UPC etc, heating costs, maintenance.

I think 70k is a very reasonable offer based on your salary. Its nearly 3x your salary thats not an insignificant amount given your low salary.

Boyne1919

D3PO wrote: »

your earning less than 25k some of which is a bonus. What exactly did you expect them to offer you ?

Just becasue you have saved an extraordinary amount of money doesnt mean they should thrown an extraordinary amount of money at you.

I can only assume you have ammased these savings becaue you live at home and live a very frugal lifestyle.

The facts are home ownership costs are more than just a mortgage.

Theres house insurance, life assurance, water tax, property tax, utility bills ESB, UPC etc, heating costs, maintenance.

I think 70k is a very reasonable offer based on your salary. Its nearly 3x your salary thats not an insignificant amount given your low salary.

Maybe it is reasonable, that's why I'm asking as I'm unsure.

You're correct I've lived at home for the majority of the time but I still had numerous bills and rent to pay. I don't drink so it helps with the savings. Also I studied after work for many years for my job so I wasn't always out blowing money. A couple of good investments have helped also.

I hope to maybe get a pay bump very soon but obviously bank can only go on current wage.

D3PO

in that case why rush to buy ?

Central bank are looking at bring in new guidlines about how much you can lend. This can only help cool the market as it stands and all of a sudden what you have goes a lot further.

At the rate your saving and with a possible pay bump coming your much more likely to be in a better position in 6 months time. Time is on your side.

Boyne1919

D3PO wrote: »

in that case why rush to buy ?

Central bank are looking at bring in new guidlines about how much you can lend. This can only help cool the market as it stands and all of a sudden what you have goes a lot further.

At the rate your saving and with a possible pay bump coming your much more likely to be in a better position in 6 months time. Time is on your side.

You're probably right, think it's a mental thing of wanting to be out of home by the time I'm 30. I purposely didn't rent on my own so I could save more.
Thanks for the advice.

mickman

Boyne1919 wrote: »

You're probably right, think it's a mental thing of wanting to be out of home by the time I'm 30. I purposely didn't rent on my own so I could save more.
Thanks for the advice.

You are doing exceptionally well. Get the pay bump and two more years saving and you will be sorted

D3PO

Boyne1919 wrote: »

You're probably right, think it's a mental thing of wanting to be out of home by the time I'm 30. I purposely didn't rent on my own so I could save more.
Thanks for the advice.

dont put deadlines on yourself, all that will lead is to you buying something that really doesnt suit your needs beyond the short term. Keep saving like the demon you are, get your pay bump and assess what the new central bank guidelines do to house prices in the first 2 quarters fo next year.

With the even greater savings you will have by then and a pay increase then you can reassess the market whats available in your price bracket and go from there.

best of luck.