Single applicant with dependents

Limitless28

Hi boardies, I applied for a mortgage with my bank and I was refused without any specific reason.

I am planning to apply with other banks but I would like to learn from your experience first and get some advice.

I am in my early thirties and separated but I still live with my ex partner and our 2 kids aged 11 and 9. The house we live in is owned by my ex and her father and they pay the mortgage.

I contribute with an amount of money of 1200 EUR per month for family expenses and I save 1200 EUR from a net salary of 2900 EUR or 48K annually in a permanent job.

I have 110k saved for a deposit and another 7k for other expenses linked to buying. I will add that I live in Dublin and I am looking to buy in Dublin to be close to my kids and work.

I have no loan, no credit card and no red flags in my credit report. I have been saving regularly for the last 10 years or so and this is how I managed to save that much.

We don't have a maintenance agreement so I approached my bank for a mortgage and provided them with all the documents required but I was refused. I guess it's due the fact that my future expenses are unclear since there is no maintenance agreement in place. Having said that I also thought that by default banks will take out 300 EUR per child for maintenance.

I am confused as I am not sure why I was refused and what I should do to be in a good position to obtain a mortgage.
Are there some banks that are more suitable to my circumstances?

Lolle06

Hi,

we went with our AIB house bank as other lenders wanted to lend us only a small amount - given the fact that we have 3 children and 1 f/t income and 1 p/t income.
I work from home and look after the children myself - so we don’t have childcare costs as such - but the lenders still take a substantial amount off our repayment capacity.

We also looked at applying for the Rebuilding Ireland home loan scheme, but didn’t need to apply for it in the end.

But a yearly income of under 50k for single applicant would make you eligible to apply for it.

Good luck!

punisher5112

The biggest issue is property prices which you will find extremely difficult to get an amount to match especially in Dublin.

Some credit unions are doing mortgage now also so maybe worth a look.

You may well have to look at undesirable areas or move further out.

BrokenArrows

Ask the bank for the exact reason.

Heres Johnny

How much of a mortgage did you apply for?
It's 3.5 times salary which is 168k added to your excellent deposit of 110k would only put you at purchasing power of 278k before they deduct for dependents.

Sunrise_Sunset

Ask the bank for the specific reason they turned you down. Then you can work on that before applying again or elsewhere.

Limitless28

Lolle06 wrote: »

But a yearly income of under 50k for single applicant would make you eligible to apply for it.

I exceed the 50K when I include my bonus and it's obvious from my P60.

punisher5112 wrote: »

The biggest issue is property prices which you will find extremely difficult to get an amount to match especially in Dublin. You may well have to look at undesirable areas or move further out.

There are some decent areas where a 2 bed apt both new and old can be gotten for just above 250K.

BrokenArrows wrote: »

Ask the bank for the exact reason.

Are they obliged to provide me with an exact reason or can they just say that I fall outside their lending criteria/eligibility?

Heres Johnny wrote: »

How much of a mortgage did you apply for?
It's 3.5 times salary which is 168k added to your excellent deposit of 110k would only put you at purchasing power of 278k before they deduct for dependents.

I didn't ask for a specific amount I just asked for the maximum amount that I can get based on my situation.

Sunrise_Sunset wrote: »

Ask the bank for the specific reason they turned you down. Then you can work on that before applying again or elsewhere.

Are they obliged to provide me with an exact reason?

Thank you all for your replies.

gogo

I’d say your in good standing but just as you guessed it the maintenance agreement. Unfortunately the partner not residing with the kids is caught twice both for having two kids at approx 200pm each and also what ever in maintenance you will pay..

You really need to formalize a separation agreement and maintenance as right now your figures are up in the air. At 50k for annum with two deps and an uncertain maintenance figure you are going to be under pressure for any mortgage. I’m assuming you have no personal borrowing at that? You have establish that you have sufficient disposable income after your outgoings.

Plus remember any apartment purchase is going to lower the LTV available to you.. slightly lower LTVs apply on apartments over houses. Different again on a one bed apartment vs a two bed

A bank dosent have to give you an exact reason for a decline, they can just state its outside credit policy if they want.. but most will tell you if you ask why.

Also bonus’s don’t count unless your employer is willing to state that it’s guaranteed every year.

BrokenArrows

They're not obligated to tell you the reason for being refused, but they will tell you.