Saving/Applying for a mortgage 2015/16/17/18/19

podgemonster

Our mortgage drawdown date is getting very close to the expiry date on our letter of offer (5 weeks away) and our property is 99% complete (6 minor snags). Has this been an issue for anyone before or does the lender usually just extend the Letter of Offer to accommodate?

purpleisafruit

podgemonster wrote: »

Our mortgage drawdown date is getting very close to the expiry date on our letter of offer (5 weeks away) and our property is 99% complete (6 minor snags). Has this been an issue for anyone before or does the lender usually just extend the Letter of Offer to accommodate?

It might be no harm to flag it with the bank but as a first step, speak to the builder and confirm the date that they expect to handover. This will give you a better idea of the need to extend the timelines with bank.

wally79

Picked up keys this morning after 3 months sale agreed and a few hiccups

Thanks to all for the guidance.

limnam

Frank Castle wrote: »

TBH I wouldn't agree with this.

I think the point is as a general rule the less debt you have going in the better you're chances are of getting what you require.


If your wages are border line for what you want and you go in with PCP/CC/OD etc it's going to have "a" impact.


So the best situation going in is to have none of it.


You might get "punished" for having it.


You won't for not having it.


So as a general rule for _most_ people it's sound advice.

Lolle06

limnam wrote: »

I think the point is as a general rule the less debt you have going in the better you're chances are of getting what you require.


If your wages are border line for what you want and you go in with PCP/CC/OD etc it's going to have "a" impact.


So the best situation going in is to have none of it.


You might get "punished" for having it.


You won't for not having it.


So as a general rule for _most_ people it's sound advice.

I agree.

The banks generally like to see „prudent“ borrowers! The less debt you take on, the better!
Especially if you have/ or plan children in the near future, you will have to take childcare costs into account and an reduced household income.

Whatever ppl say about the loose lending habits of banks during the Celtic Tiger years - they have certainly learned to tread more carefully now.

ELM327

Lolle06 wrote: »

I agree.

The banks generally like to see „prudent“ borrowers! The less debt you take on, the better!
Especially if you have/ or plan children in the near future, you will have to take childcare costs into account and an reduced household income.

Whatever ppl say about the loose lending habits of banks during the Celtic Tiger years - they have certainly learned to tread more carefully now.

This is not good advice.
In the bank's eyes, the best candidate has had much debt and cleared it with no issues.
A candidate with no history of debt is viewed as risky.

limnam

ELM327 wrote: »

This is not good advice.
In the bank's eyes, the best candidate has had much debt and cleared it with no issues.
A candidate with no history of debt is viewed as risky.

Clearing previous debt while might aid in a credit rating it will have no baring on affordability.


Having _current_ debt will.

Interested Observer

Got our AIP this week. Thought we were going to need an LTI exception but our broker convinced the bank to take some overtime into account so don't need one now. We'd run into a brick wall with this when dealing with banks ourselves, it was salary only. My wife makes nearly a third of her total pay in overtime so it was a huge chunk of our income.

wersal gummage

Slightly off the point, but what does it mean to be able to afford credit card debt?? The interest rate is generally high (apart from maybe some introductory switch deal), and higher than almost any other form of credit. It would make no sense to have credit card debt to me, if you can "afford it" surely you'd discharge it and not be carrying it? Can anyone explain what I'm missing?

wersal gummage

Slightly off the point, but what does it mean to be able to afford credit card debt?? The interest rate is generally high (apart from maybe some introductory switch deal), and higher than almost any other form of credit. It would make no sense to have credit card debt to me, if you can "afford it" surely you'd discharge it and not be carrying it? Can anyone explain what I'm missing?

bleary

ELM327 wrote: »

A candidate with no history of debt is viewed as risky.

My experience was that this is not taken into account in Irish risk scoring. It is in other countries like the US where building up a credit score is advised but has no implication in Ireland .

And in relation to credit card debt, paying interest on credit cards is crazy.
You should clear your debt or your borrowing capacity will be reduced

hanaimai

bleary wrote: »

My experience was that this is not taken into account in Irish risk scoring. It is in other countries like the US where building up a credit score is advised but has no implication in Ireland .

And in relation to credit card debt, paying interest on credit cards is crazy.
You should clear your debt or your borrowing capacity will be reduced

This is my experience also. We had no debt whatsoever and never had and we encountered zero issues in getting the full 3.5 times our salary (we were offered more by one bank). Most of the mortgage advisors were delighted we had no loan/credit card etc. details to add to the application.

I met with both a Broker and a Bank recently to start the mortgage process.
We went in with loads of questions based on what we had heard from other people.

Both the broker and the Bank told us the following:
* No need to clear my overdraft of €350 - That amount is absolutely fine
* Having a car on PCP is absolutely fine, as long as repayments were been made every month
* Using your bank card in a pub is no big deal - This was from the Mortgage advisor in PTSB. He said that banks aren't stupid. People go to pubs, and sometimes forget to get cash out. As long as it's not daily/lots of transactions every weekend, then it's not an issue.

The main financial concerns from both the bank and broker were:
* What are our savings
* How much rent are we paying each month
* How much more are we saving each month

I asked about moving jobs, and was advised to hold off on that for the time being, as that would hold us up seriously
We got married a few months back, so out joint account is all over the place for the past 6 months. They both said that is fine, as long as we can defend all of the fluctuation.

Anyway, we've applied for the mortgage a week ago, so hopefully hear back next week. I'll probably come back to tell you that we were rejected :P

cruizer101

Any other debt will be taken into account when the bank is calculating how much you can afford to repay.

When deciding how much to offer they look at 3.5 time salary but also repayment capacity.
This is based on your net income being greater than stress tested mortgage repayment (e.g. +2% interest) + living expenses (think 1,500 ish per month, varies by bank) + any other outgoings you are committed to such as paying off other loans.

So if you are paying a lot of other loans you will potentially be offered less than 3.5 multiple as they think you don't have the capacity to keep up with mortgage repayments.

Also credit card debt is terrible to have given the interest rate, far better to take a credit union loan and clear it.

limnam

cruizer101 wrote: »

Also credit card debt is terrible to have given the interest rate, far better to take a credit union loan and clear it.

Credit union interest rates aren't as good as they used to be when "I were a lad"


The best thing to do is move it on a 6 month 0% interest and lash into it

Interested Observer

[Deleted User] wrote: »

I met with both a Broker and a Bank recently to start the mortgage process.
We went in with loads of questions based on what we had heard from other people.

Both the broker and the Bank told us the following:
* No need to clear my overdraft of €350 - That amount is absolutely fine
* Having a car on PCP is absolutely fine, as long as repayments were been made every month
* Using your bank card in a pub is no big deal - This was from the Mortgage advisor in PTSB. He said that banks aren't stupid. People go to pubs, and sometimes forget to get cash out. As long as it's not daily/lots of transactions every weekend, then it's not an issue.

The main financial concerns from both the bank and broker were:
* What are our savings
* How much rent are we paying each month
* How much more are we saving each month

I asked about moving jobs, and was advised to hold off on that for the time being, as that would hold us up seriously
We got married a few months back, so out joint account is all over the place for the past 6 months. They both said that is fine, as long as we can defend all of the fluctuation.

Anyway, we've applied for the mortgage a week ago, so hopefully hear back next week. I'll probably come back to tell you that we were rejected :P

This is basically identical to my experience, including the wedding and all the mad transactions that come with it. I even did move job which has held us back, but felt the job was worth it.

It's all about savings and capacity to repay.

Rfrip

Got my keys! Again thanks to the thread, was a fountain of knowledge
New build, which im realising a complete money pit!!! But delighted with everything and it was the right move for me!

I bought in cork, my solicitor is based there and my mortgage was with BOI
Both were brilliant and really everything was seamless. All i felt i had to do was just sign a few forms tbh
My only stress was the mortgage protection which was nothing to do with above
Anyway, if anyone would like my contacts above i would strongly recommend them

TheShow

Credit card debt is not “terrible to have” as you say. Yes the rates can be higher, that’s it. If you carry a balance on your card then the banks will factor 5% of the balance as a monthly commitment in your calculations, which will reduce how much you can borrow on a mortgage. If you use your card and pay it off in full every month then there will be no impact.

Again, all this hokem being pedalled about banks viewing loans etc negatively. Like I said previously and another poster also stated, as long as you have savings, and can afford what you are looking for then it’s a non issue. The fact that you can demonstrate loan repayments is a positive. Having had no loans is not a negative factor either.

Your monthly commitments (loans, life cover, property tax, stressed mortgage payment, childcare costs) should not be any more than 40% of your net salary. Banks have different policies and some go to 50% of your net salary for high income earners. Banks also look for a minimum net disposable income figure which varies depending on how many applicants and dependants there are. But both of these are only bank policies and not CBI policies.

Once you’re within the 40% and meet the central bank rules and have a good savings record and have all your statements etc lined up, the approval process should be very straight forward.

The best way to figure out what you are likely to get approval for is to go on any of the banks websites and use their mortgage calculators. Put in how much you ideally want, then input with and without loans etc and see how much the difference is. If you’ve a fair idea of what’s in your budget mortgage wise, then you’ll know how much you need to save and you shouldn’t have any major shocks when you apply for a mortgage.

kippy

TheShow wrote: »

Credit card debt is not “terrible to have” as you say. Yes the rates can be higher, that’s it. If you carry a balance on your card then the banks will factor 5% of the balance as a monthly commitment in your calculations, which will reduce how much you can borrow on a mortgage. If you use your card and pay it off in full every month then there will be no impact.

Again, all this hokem being pedalled about banks viewing loans etc negatively. Like I said previously and another poster also stated, as long as you have savings, and can afford what you are looking for then it’s a non issue. The fact that you can demonstrate loan repayments is a positive. Having had no loans is not a negative factor either.

Your monthly commitments (loans, life cover, property tax, stressed mortgage payment, childcare costs) should not be any more than 40% of your net salary. Banks have different policies and some go to 50% of your net salary for high income earners. Banks also look for a minimum net disposable income figure which varies depending on how many applicants and dependants there are. But both of these are only bank policies and not CBI policies.

Once you’re within the 40% and meet the central bank rules and have a good savings record and have all your statements etc lined up, the approval process should be very straight forward.

The best way to figure out what you are likely to get approval for is to go on any of the banks websites and use their mortgage calculators. Put in how much you ideally want, then input with and without loans etc and see how much the difference is. If you’ve a fair idea of what’s in your budget mortgage wise, then you’ll know how much you need to save and you shouldn’t have any major shocks when you apply for a mortgage.

At the end of the day, as you've said, once you are paying back your loans there generally isn't an issue however, having loans is definetly seen as a negative if it is combined with a higher risk career.
Outside of your health your income is your greatest asset.
I'd often ask myself why does someone have X amount of savings and y amount of loans..the loans cost a lot to service.
Also, I'd question how leveraged a person is with respect to their loans if their income were suddenly to be reduced or disappear altogether....this is when and where the issues occur.
Again having debt is not necessarily a bad thing depending on the circumstances however it all depends on individual circumstances.

Interested Observer

Anyone know if there are issues with applying to BOI through a broker? Heard something similar.

Interested Observer

Interested Observer wrote: »

Anyone know if there are issues with applying to BOI through a broker? Heard something similar.

I had heard the same, but then we went through a Broker, and she gave us an offer of BOI. Perhaps they only deal with certain brokers

Goose76

There’s a property on MyHome (Dublin) which doesn’t seem to be selling - it’s way way out of our price range (by some 300k:pac:) but it’s been online for months with no movement.

Would it *** an agent off and be a black mark on our future relationships with this agent if we bid our max offer - which would be some 300k under asking price. I know it might sound ridiculous but if you don’t ask, etc...::o

Interested Observer

Goose76 wrote: »

There’s a property on MyHome (Dublin) which doesn’t seem to be selling - it’s way way out of our price range (by some 300k:pac:) but it’s been online for months with no movement.

Would it *** an agent off and be a black mark on our future relationships with this agent if we bid our max offer - which would be some 300k under asking price. I know it might sound ridiculous but if you don’t ask, etc...::o

Your bid is not going to be accepted so don't really see the point tbh.

chrismon

Anyone have issues with EA's not calling you back?
There's on in particular where I live that has most of the properties, I keep ringing them about viewing different houses but no call back.

bri007

Yeah we are having the exact same problem, even when we bid on a house, they are slow and sometimes don’t even acknowledge our bid. One estate agent in particular!

We had to keep ringing and eventually go to the manager to eventually get a reply.

They are a shower of........

chrismon wrote: »

Anyone have issues with EA's not calling you back?
There's on in particular where I live that has most of the properties, I keep ringing them about viewing different houses but no call back.

fg1406

bri007 wrote: »

Yeah we are having the exact same problem, even when we bid on a house, they are slow and sometimes don’t even acknowledge our bid. One estate agent in particular!

We had to keep ringing and eventually go to the manager to eventually get a reply.

They are a shower of........

Yes I had that issue with an EA I was dealing with here last year. I couldn’t even get him to give me a viewing. A nightmare to deal with. I used to get my sisters, my mother and my husband to call in the hope 1 of us would get a call back and get a viewing.

chrismon

Ridiculous so it is.
Nice to know it's not just me.

purple hands

Hi folks

For those that bought second-hand, did you do a pre-close walkthrough and how was it organised? i.e. the day before, or day of closing?

purpleisafruit

Got the keys for my house on Friday, 3 weeks ahead of schedule. Hoping to move in in 2 weeks once we have our flooring and furniture delivered.
Long road but it'll be worth it in the end

wally79

purple hands wrote: »

Hi folks

For those that bought second-hand, did you do a pre-close walkthrough and how was it organised? i.e. the day before, or day of closing?

Were due to close on Thursday/Friday and did it Thursday morning. Just called estate agent maybe a week in advance and they had someone there to let us in

Ended up not closing til Tuesday but all good

Edit.
Think about what you want to check.

Eg If there’s an attic you want to check is empty will there be a stepladder there or should you bring one

Bring torch etc