New Buyers

Redgreenbin

Hi all,

I know it's a nightmare time to buy and everything like that but myself and my partner have been saving independantly for a number of months now.

We are going to get a joint bank account this month but just looking for tips and advice on the best way to go about it.

We were going to go into the bank at the end of the month to have a chat about it.. just want everything to be in order before we actually apply for a mortgage!

All advice appreciated.

Thanks!

fret_wimp2

standard advice:

- be able to show a min of 6 months of regular healthy saving. monthly saving of a few hundred euros looks better than a much larger lump sum.

-dont have any online gambling transactions against any current or credit card accounts.

-have any short term loans paid off.

-dont have kids ;-)

-dont work in civil service. mortgage broker confirmed to us that civil servants will get less due to levies. That could have changed in recent times however. I know civil servants get mortgages so its not a big issue but will affect the total you can borrow.

-both be in permanent full time employment. Mortgages are granted to contractors and part time employees but you may have to jump through a lot more hoops or settle for less than you expect/need.


None of the above should be deal breakers but they will have an effect on how much will be offered.

Redgreenbin

Thanks! All your advice is very much appreciated!

Want to have everything looking good for when we go for the mortgage!

It's a scary, exciting thought

conf101

Just on the kids thing - I know it was said in jest above (I think) but the bank basically calculate a "cost" per month for each child you have. In the same way that loan will reduce the total amount you have available to repay a mortgage each month, a child will too. It's calculated in the same way. I think for most banks it's €250 a month, though I'm not certain on that. If you have childcare costs the take those into account too.

The list above pretty much covers it. It might also be worth checking your ICB credit report (http://www.icb.ie/cr_options.php), in case there's something you're not aware of. Your bank will do this anyway when you apply, but it might save you time down the line. I only disovered I had a mark on my report when my bank checked it when I applied for a mortage. It was caused by an oversight by the bank and was easily resolved, but it did delay the mortgage process by a few weeks, which I could have avoided had I checked it in advance. I think it only costs €6 to get a copy of your report.

brownbinman

fret_wimp2 wrote: »

-dont work in civil service

rubbish. in civil service and got a mortgage no problem

fret_wimp2

brownbinman wrote: »

rubbish. in civil service and got a mortgage no problem

read the full post, i said its a factor that affects how much you will get, not a full out blocker to getting a mortgage.

californiabear

You don't necessarily need a joint account to progress - in fact, I'd advise against changing accounts just before applying for a mortgage as you may not have access to paperwork/history as you need it. The bank don't care if you're managing joint account or not in my experience, they assess the total picture for all bank accounts involved.

cruizer101

Kids are big thing I think, none myself but out of curiosity I put in that have one one one of the online calculators and it significantly reduced the amount offered, now they have to be taken with a pinch of salt but still think does have a big effect.
Not a lot you can do if you have a kid already, but if planning on having some definitely wait.

Yeah the ICB report is 6 euro, I was worried I may have missed a CC payment previously and after reading another thread on here where one missed payment resulted in no banks offering mortgages I decideed to get one, worth it just for piece of mind.

No other advice to offer as only just really starting the process now we have a bit saved. I don't think a joint account is necessary mind so long as they can see consistent savings in one or both applicants accounts.

Irishcrx

How would the bank actually know you have kids or not?

Creamy Goodness

Irishcrx wrote: »

How would the bank actually know you have kids or not?

going through your statements; creche fees, after school fees, shopping in Tesco/Lidl/Aldi etc. for amounts more than the applicants on the application. It's also a question (in the form of dependants) on the mortgage application form. It's not something I'd want to be lying about anyways.

Having just gone through this process with KBC, they requested to know a reason for any ATM withdrawal over €200 was for too. I had two withdrawals for €500 in the last six months and they wanted to know what it was for.

Mike3549

Irishcrx wrote: »

How would the bank actually know you have kids or not?

Creche fees, child benefits, yeah im pretty sure bank would find that out very quickly

Redgreenbin

Hi californiabear,

That's interesting - I always thought a joint savings account with savings going in monthly would be beneficial. I would be setting up the joint account 12 months ahead of applying for a mortgage.

Want to have all my ducks in a line so to speak

Colonel Claptrap

fret_wimp2 wrote: »

read the full post, i said its a factor that affects how much you will get, not a full out blocker to getting a mortgage.

Still rubbish.
A permanent, pensionable job, virtually impossible to get the sack, recession proof employer compared to private sector. Banks love civil servant applicants.

L1011

Colonel Claptrap wrote: »

Still rubbish.
A permanent, pensionable job, virtually impossible to get the sack, recession proof employer compared to private sector. Banks love civil servant applicants.

It has a definite impact on multipliers due to the lower take-home pay. The PRD is at best going to be replaced with a pension contribution and those are deducted pre multiplier too

Mike3549

Colonel Claptrap wrote: »

Still rubbish.
A permanent, pensionable job, virtually impossible to get the sack, recession proof employer compared to private sector. Banks love civil servant applicants.

No they dont. They love future lawyers, people in IT.
You will get a mortgage, but you can forget about exceptions etc.
Banks know that people in private sector have more chances of a promotion or other types of wage increases.

Aaron15

Hi, best of luck with the savings, it's seems endless at the beginning but after a while it flys along and you'll get to where you want to be, we've been saving 2 years now and just went sale agreed on a new property. In regards to the short term loans, me and my partner both had short term loans, and we got approved no problem, we saved 500 each a month, try not to use your bank card paying for everything, and set yourself a budget as to what you want and need to spend each month, you'll get to where you want to be, hope all goes well ☺️

Samuel T. Cogley

Mike3549 wrote: »

No they dont. They love future lawyers, people in IT.
You will get a mortgage, but you can forget about exceptions etc.
Banks know that people in private sector have more chances of a promotion or other types of wage increases.

BAhahahahahahahahahahahahaha! :pac:

Wanna know what the average barrister makes? Less then the window cleaner and with less job security.

Also contract work is fine for some banks depending on sector.

Use of a broker is not always a great idea as they only deal with certain banks. By all means use one if free but also approach the other banks personally.

Bananaleaf

californiabear wrote: »

You don't necessarily need a joint account to progress - in fact, I'd advise against changing accounts just before applying for a mortgage as you may not have access to paperwork/history as you need it. The bank don't care if you're managing joint account or not in my experience, they assess the total picture for all bank accounts involved.

Bank suggested a joint account to us. We opted to decline their offer as we feel that we pay enough bank charges as it is

Bananaleaf

Irishcrx wrote: »

How would the bank actually know you have kids or not?

They wouldn't really. But, it's not something I would lie about. First of all, the threshold is there to protect you. Why would you want to borrow more than you can afford to pay back?
If they get a sniff that you are lying, i.e. If it comes out via your bank statements they could pull the offer.

dubrov

Mike3549 wrote:

No they dont. They love future lawyers, people in IT. You will get a mortgage, but you can forget about exceptions etc. Banks know that people in private sector have more chances of a promotion or other types of wage increases.

It's the opposite I think. Banks generally give the exemptions to those in public sector and semi state. They don't really care about later salary increases but do care about the possibility of it decreasing

fret_wimp2

dubrov wrote: »

Mike3549 wrote:

No they dont. They love future lawyers, people in IT. You will get a mortgage, but you can forget about exceptions etc. Banks know that people in private sector have more chances of a promotion or other types of wage increases.

It's the opposite I think. Banks generally give the exemptions to those in public sector and semi state. They don't really care about later salary increases but do care about the possibility of it decreasing

100% sure it's not the opposite. one of the questions on our application was if we were public or private sector.

I asked what difference it makes and was told that public sector often can mean a lower offer, due to levies placed on public sector pay.

The_Honeybadger

Mike3549 wrote: »

No they dont. They love future lawyers, people in IT.
You will get a mortgage, but you can forget about exceptions etc.
Banks know that people in private sector have more chances of a promotion or other types of wage increases.

Absolute nonsense. Job security is one of the biggest things you can have going for you when looking for finance. The take home pay is marginally lower in the public service due to levies as you rightly say, but the effect on the amount of finance offered as a result would be almost negligible.

There are also plenty of opportunities for career advancement in the public sector for those with the qualifications and ambition to pursue them.

Having gone through the process last year kids are definitely a massive factor. AIB deducted €250 per child per month from our income and also took off childcare fees. This had a dramatic effect on what we could borrow but luckily we were just about able to get the house we wanted anyway as we had a good sized deposit and low LTV. It is better to apply before starting a family in general.

dubrov

fret_wimp2 wrote:

I asked what difference it makes and was told that public sector often can mean a lower offer, due to levies placed on public sector pay.

In one way that is correct as the take home pay is less for the same gross salary. However the offer would be generally at the limit or an exemption if joint applicants were public sector.

The_Conductor

dubrov wrote: »

In one way that is correct as the take home pay is less for the same gross salary. However the offer would be generally at the limit or an exemption if joint applicants were public sector.

BOI- automatically refuse an exemption to public sector- as there is no upside for salaries- that you'd have in the private sector. I don't know about other lenders. BOI also reduce the maximum to a public sector employee- in recognition of the reduced take home pay for the public sector........

Don't believe everything you see in the media (or indeed on the internet!)

dubrov

The_Conductor wrote:

Don't believe everything you see in the media (or indeed on the internet!)

It's not the media. It makes no sense from a risk point of view.

Cash_Q

OP you say that you are going to approach the bank when you feel you're ready to apply for mortgage approval; if I were you I would make an appointment now so that they know everything you're already doing, and can tell you if there are other areas they will be seeking information. We did this and were told to show stronger evidence of savings from my husband and to change address on some statements/accounts to ensure that every piece of evidence was coming from the one address. While you may feel you'll be ready in one month, you don't want any delays to crop up at that point, so what harm would it do to have a pre-application meeting now to find out exactly how well they think you're doing.

The_Conductor

dubrov wrote: »

It's not the media. It makes no sense from a risk point of view.

Underwriters decide on these things- and the underwriters in different institutions don't necessarily agree with one another. In BOI- the criteria may be different to other lenders- its how they, as an institution, perceive the risk to be. BOI is obviously more risk averse than are AIB and some other lenders- this is bourne out by the fact that they were never majority owned by the government after the bail-out- whereas AIB ended up in 99.8% public ownership. And- its an institutional issue in AIB- its not the first time they had to be bailed out- its actually their third bailout in the last 40 years.

californiabear

Redgreenbin wrote: »

Hi californiabear,

That's interesting - I always thought a joint savings account with savings going in monthly would be beneficial. I would be setting up the joint account 12 months ahead of applying for a mortgage.

Want to have all my ducks in a line so to speak

We've been through the mortgage process 3 times, the most recently just over 2 years ago, and always had separate bank accounts. No issue from banks at all. If it is just for savings, then there's no harm in setting one up, but I don't believe its a necessity.
The key thing the bank will want to see is regular savings - either of you can do this depending on how you split bills/who earns more etc.

The_Honeybadger

The_Conductor wrote: »

BOI- automatically refuse an exemption to public sector- as there is no upside for salaries- that you'd have in the private sector. I don't know about other lenders. BOI also reduce the maximum to a public sector employee- in recognition of the reduced take home pay for the public sector........

Don't believe everything you see in the media (or indeed on the internet!)

Don’t know about BOI, but AIB took our combined net take home pay and worked backwards using a set formula to calculate what we could borrow, taking off childcare etc. Therefore It may not be totally accurate to state that they reduce the maximum because the applicant is a public servant. It’s due to a slightly lower take home pay as a consequence of being a public servant, which is being a bit pedantic maybe, but there you go.

Another point worth noting is that if the private sector applicant on a similar salary was making pension contributions (as many would be) it would balance out in any case.

I don’t think there is any significant downside to being a public servant, but there is a very strong upside in terms of bulletproof job security.