What am i supposed to do

thethreeofus

Hey All,
Im looking for some advice if anyone else is in the same situation, I am a single mom (not by choice) with two amazing girls. I am currently on the housing list as my basic wages is not great.I work full time and study part time. I rent privately.  For the past 6 months I have been working 10/15 hours a week overtime to save for a deposit for a council mortgage as it was only 3% of the purchase price and hoped to have enough saved by the end of the year. Now this is gone!!! I now have to save 10% to be considered for a government mortgage, Which will take me years. Is there any where else i can turn.. I just want a home for me and my girls. Im in good standing with the bank but need a deposit of 50,000 for a 150000 house loan because of my wages and they wont take overtime into account. I feel deflated.

source

I think your maths are a little off there op, 10% of €150,000 is €15,000.

€50,000 deposit would be 10% on a €500,000 loan.

thethreeofus

10% for a government mortgage, 50,000 for a bank mortgage

hots

source wrote: »

I think your maths are a little off there op, 10% of €150,000 is €15,000.

€50,000 would be 33%.

OP says because of wages, could be capped by 3.5* rule.

lorcand1990

source wrote: »

I think your maths are a little off there op, 10% of €150,000 is €15,000.

€50,000 would be 33%.

Yes, but the banks only let you borrow 3.5 times your yearly salary for a mortgage. E.g. if you're on 25,000 per year you can only borrow 87,500 & would need to have saved the money for the rest of the property

source

lorcand1990 wrote: »

Yes, but the banks only let you borrow 3.5 times your yearly salary for a mortgage. E.g. if you're on 25,000 per year you can only borrow 87,500 & would need to have saved the money for the rest of the property

My apologies i missed the word bank, i presumed you were still talking about the government mortgage. My apologies.

iluvfatfrogs

thethreeofus wrote: »

Hey All,
Im looking for some advice if anyone else is in the same situation, I am a single mom (not by choice) with two amazing girls. I am currently on the housing list as my basic wages is not great.I work full time and study part time. I rent privately.  For the past 6 months I have been working 10/15 hours a week overtime to save for a deposit for a council mortgage as it was only 3% of the purchase price and hoped to have enough saved by the end of the year. Now this is gone!!! I now have to save 10% to be considered for a government mortgage, Which will take me years. Is there any where else i can turn.. I just want a home for me and my girls. Im in good standing with the bank but need a deposit of 50,000 for a 150000 house loan because of my wages and they wont take overtime into account. I feel deflated.

Just to clarify, why do you need €50k deposit for €150k mortgage?
This may help people give better advice

thethreeofus

iluvfatfrogs wrote: »

Just to clarify, why do you need €50k deposit for €150k mortgage?
This may help people give better advice

yes from the bank I need €50k for a €150k mortgage, for the government mortgage I would need €15k

Jim2007

What is actually wrong with renting? Millions of people all over Europe do so and do just fine. You are already in a tight financial situation and taking on large a block of debt will leave more exposed than ever when the next recession hits and hit it will.

When you buy a property you break every single rule of investing. You buy in to a high risk asset class, you borrow to do so, you fail to diversify and you buy an illiquid asset. It should come as no surprise then to be told that Irish citizens lost more of their personal wealth than any other EU citizens. Experience shows that getting on the property ladder is not the wise safe option many people unhesitatingly think it is.

As an Irish person having lived through a few recessions in Switzerland now, I would say the recession was just as bad here as in Ireland in terms of job losses and so on. But people were not personally impacted as badly because they did not have big financial commitments - a couple of months rent, a few HP payments on the car and that was it. They had options: find some where cheaper to live, move in with relatives for a while, accept a lower paying job or even seek a job else where in the country.

Another thing to consider is that as your kids grow up there will be other financial commitments that you may not be able meet if you are fully committed to a mortgage. College education and training, fitting them out for that first job, a deposit for a flat and so on.

So I’d say don’t be too disappointed if you can’t buy a home. Renting has merit, it is not dead money, it puts a roof over your head and probably does so with less financial risk than otherwise. And it may put you in a better position to help your girls financially in other ways down the line.