Mortgage figures

katiek102010

We are trying to get a mortgage and can't.

Property is still pretty reasonable where we are.

We were looking at a nearby property 130k we have 75 deposit and cannot get a mortgage

Husband earns 30k we have a disabled child and I'm full time carer. The banks or brokers will not even look at us as he is earning too little, repayments would be approx 300 pm where as we are paying 1000 pm rent

He is the thing the deposit is solely my money. It's made up of my savings, inheritance and equity from a previous home sale.

We have been given a work around that I give money to him and he gets property in his own name.

We are married but I'm reluctant to do this as it will involve legal paperwork to say I'm gifting him money

What would you do

Sono

Am I right in saying you are looking for a mortgage of 55k or have I read that wrong? Surely your husband meets that criteria with the 3.5 time salary rule no?

Or is it 75k deposit and a mortgage of 130k?

katiek102010

Yes figures are correct. Looking for 55k

Being married he is classed as having 2 dependents.

Our child is disabled and I am full time carer, in receipt of carers.

Banks have minimal earnings requirement and its basically

30k for earner and varies between 5 anf 7.5 k per dependent, therefore he would need to be earning 40k plus to get a mortgage in joint names.

When if you put his details into an online calculator it will say contact the bank. We are with boi and even then their calculations will only give 37k mortgage on his own. The 3.5 times salary is a myth, in my opinion

drunkmonkey

You want to take legal advice but he won't be getting the property in his own name he'll be getting the mortgage in his name but this I think is the bit your concerned about, the property can still be registered in both your names I think.
Are getting 0 payments for full time caring, I thought there was money for that can you put it down as income.
You should have a chat with a different broker, if you could keep some of your saving I would rather than gifting it all away.

Not sure if it's a runner but should your hubby start looking for a better paid job, 30k is pretty low paid at the moment. They were crying out for drivers the other day starting on 50k.

Xodar

If you have savings in the credit union you could try for a special rate loan.

jlm29

I don’t understand your reluctance to get a letter saying you’re gifting him the money, if you put it all into the house deposit anyhow, the money is gone and the house is in joint names, so essentially you are gifting him the money either way.
But I also wouldn’t have thought it would make too much difference- if he applies for a mortgage by himself he will still be asked about other householders and have to declare that he has dependants? Or was his plan to go in with the deposit, pretend he has no wife and child and get the mortgage as a single applicant? Because he can’t do that either.
Maybe go and talk to a few brokers and see have any of them got any suggestions. Good luck!

cruizer101

Could be worth trying the credit union some of them are doing mortgages now and may well have a bit more flexibility in who they will loan to. They don't have the best of rates but given the mortgage is quite small it shouldn't have that big an effect on the repayments.

Regarding gifting the money to him I didn't think there would be any paperwork as you are married so in some sense considered as one unit it doesn't matter where the money originated it is both of yours, but you would want to get proper advice on that.

jlm29

katiek102010 wrote: »

Yes figures are correct. Looking for 55k

The 3.5 times salary is a myth, in my opinion

It’s not a myth, but it is the max they will lend. They need to look at affordability as well as the 3.5 times salary rule, which is what is catching you, unfortunately

drunkmonkey

If you put some of your cash into the deal with the seller it'll bring down the purchase price which will get you through the times salary rule. You'll need to talk to the seller directly about doing that.

Pistachios & cream

Would the rebuilding Ireland home loan scheme work for you?http://rebuildingirelandhomeloan.ie/

cruizer101

drunkmonkey wrote: »

If you put some of your cash into the deal with the seller it'll bring down the purchase price which will get you through the times salary rule. You'll need to talk to the seller directly about doing that.

The 3.5 multiple isn't the issue

Banks have 3 main criteria to be fulfilled for mortgage
1. The 3.5 multiple (mortgage amount of 3.5 times gross salary, possible exceptions).
2. Deposit amount 10% of purchase price (or 20% for non first time buyers)
3. Affordability, your monthly take home minus mortgage and other out goings must be over a certain amount.

Its number 3 that is the problem here so with 30k earnings take home is 2.5k ish (there is not going to be much tax paid on that low an income), they may also take child allowance or if there is any carers allowance into play here.
After the mortgage payment is taken out (and any other loan repayments) you must have a certain amount left over and that will increase for each dependent, (the amount varies a bit by bank).

I would have thought given the mortgage is so small you would have made the criteria, is there any other outgoing (loans, credit card debt etc.)?

drunkmonkey

Is it a risky loan for the bank, LTV is low, they own over half the house, family living it with one wage coming it, would be very hard to reposess and be seen as high risk.

voluntary

katiek102010 wrote: »

The 3.5 times salary is a myth, in my opinion

3.5x salary is the max limit, not a given value.

In bank's view you don't earn enough to support yourself and save any money. It cruel but true. Have you though about applying for a social housing?

katiek102010

Reluctance to gift him the money reason.

Banks insist on a letter saying its a gift and no requirement to repay. House would also have to be in his name to meet the terms of the mortgage. I'm not happy with this as there is no security for myself and son.

I have spoken with 3 mortgage brokers.

Only bank that will take carers is ulster bank and figures are coming back similar.

Rebuding Ireland is a no go as I'm not a first time buyer. Deposit is coming from my house which had to be sold as we couldn't afford mortgage on one salary as can't get childcare for a disabled child.

No credit unions in our area offering mortgages konly secured loans on existing properties

Driving jobs for 50k please send me a link as that is what he does but doesn't have hgv as he's dyslexic and has struggled through test.

We are waiting for social housing but it's waiting and waiting and waiting and there are currently 0 houses for rent in our area. A friend has been given her notice on her rental and is currently in a hotel waiting for housing. Herself husband and 3 kids. Both working and still can't get a mortgage

voluntary

jlm29 wrote: »

I don’t understand your reluctance to get a letter saying you’re gifting him the money, if you put it all into the house deposit anyhow, the money is gone and the house is in joint names, so essentially you are gifting him the money either way.

That's not completely true. Even though the house in your example would be in joint names, when divorce/split the court would take into account what part of the deposit was paid by which party and would calculate preceedings of the sale adequatly.

drunkmonkey

katiek102010 wrote: »

Reluctance to gift him the money reason.

Banks insist on a letter saying its a gift and no requirement to repay. House would also have to be in his name to meet the terms of the mortgage. I'm not happy with this as there is no security for myself and son.



Driving jobs for 50k please send me a link as that is what he does but doesn't have hgv as he's dyslexic and has struggled through test.

What security are you looking for both your names will be registered owners of the property, he can't just turf you out and keep the house if that's your concern, he also owes you back half of the "gift" they should be a gentleman's agreement between you. Doesn't need to be cash, he can pay a few bills you don't have to.

Not HGV drivers, construction drivers there crying out for. Starting on 50k, they were on the telly looking for them about 2 weeks ago. There's some recruitment thing happening soon it's worth checking out. I don't have the details you'll have to find them yourself.

jlm29

voluntary wrote: »

That's not completely true. Even though the house in your example would be in joint names, when divorce/split the court would take into account what part of the deposit was paid by which party and would calculate preceedings of the sale adequatly.

Ok fair enough. But I still don’t see why it would make a difference to his application anyhow. He would still have to declare his dependants, surely he wouldn’t get any extra money by doing it that way?

pwurple

Can you swap roles here?

If he has limited earnings, can you earn more than him. He becomes the full time carer?

Sorry to say, but 30k to support 3 people is low...

djan

Its a shame that banks will not take into account carers allowance, even though, I would argue its more stable than most jobs. On top of that you currently pay 1k rent while your repayments would be roughly 300eur. This is where an individualistic approach by the bank should be taken and CBI rules just used as guidelines.

Unfortunately your case is not straightforward and on such a low mortgage the bank doesnt make much money so could not be worth their hassle.

I would definitely try a broker and if not then look at financing through a loan in Credit Union or normal bank. Could be an idea to see if you could reverse roles to increase earnings?

daheff

katiek102010 wrote: »

Reluctance to gift him the money reason.

Banks insist on a letter saying its a gift and no requirement to repay. House would also have to be in his name to meet the terms of the mortgage. I'm not happy with this as there is no security for myself and son.

I have spoken with 3 mortgage brokers.

something doesnt sound right here. If you are married then your money would be joint, not single. While your husband has a job, the mortgage would be in both your names as applicants. House ownership would again be joint -any solicitor advising different should be avoided.

I'd suggest you talk with MABS and find another mortgage broker (i'm guessing you are in the country, so would suggest find one in Dublin).

Have you been to the meetings with the banks/mortgage brokers?

voluntary

daheff wrote: »

something doesnt sound right here. If you are married then your money would be joint, not single. While your husband has a job, the mortgage would be in both your names as applicants. House ownership would again be joint -any solicitor advising different should be avoided.

That's not true. By getting married you don't magically merge your wealth. Whatever you owned pre-marrage stays yours, whatever is gifted to you during marriage is yours. When marriage ends you can take what is yours, only the common part (whatever you earned over the marriage period) is mutually owned.

I'd advice OP to listen to a solicitor and NOT to internet forums.

.......

I cant understand this bit about the bank saying you gift him the money?

Under Irish law the family home belongs to both spouses, and I dont see how a bank can circumvent the rules by having a married man apply for a mortgage as a single man - it doesnt make sense?

In fact, I was of the understanding that both spouses had to be named on the mortgage and deeds if the property was being bought as the family home.

banie01

Many banks have a lower limit on Mortgages and afaik 55k would be beneath the lower limit.

Couple that with the reduction in line with the dependants and the loan becomes unattractive for the lender.

Would the credit union be an option?
Or perhaps have a talk to a broker?

phormium

You having the deposit and gifting it etc is neither here nor there, the banks are not going to give him a mortgage in sole name if married and even if they did he would still have two dependents so affordability calculator would still catch you.

Some banks take carers, think UB does but you may still not qualify.

I would try credit union especially if there is a big one near you and preferably if you are already a member, many of them are now doing the equivalent of mortgages, rate will be higher and term shorter but nevertheless might be best option for such a small mortgage.

As above have you looked at a alternative lenders?
Could you move in with family or rent somewhere cheaper?
Four years of no rent would almost pay for the house.

Samuel T. Cogley

Take legal advice, perhaps even from FLAC on the upshot of him being gifted the money from you. Frankly I don't see what difference it makes but I'm not a mortgage broker.

My LIMITED understanding is the Family Home Protection Act would protect you and in the case of a divorce my LIMITED understanding is that the courts are very unlikely to remove the custodial parent from the family home.

SusanC10

OP - are you married ?

As far as I am aware if married then the Bank will insist on both names on the Mortgage and Deeds.

Phileas Frog

SusanC10 wrote: »

OP - are you married ?

As far as I am aware if married then the Bank will insist on both names on the Mortgage and Deeds.

Absolutely this.

LirW

We've been in a somewhat similar situation, I can share with you that we did.

Had a substantial deposit but the earnings were too little at the time to get a mortgage. Himself was earning around what your husband makes and I just gave birth after a really complicated pregnancy that left me out of work.
We had an idea where we could move to and were short of a bit too just like you.
To clarify we weren't married but once there's a biological child of the couple involved he couldn't apply as single applicant.
You're married so this has to be a joint application and both your names will be on the deed.

Regarding financing you won't find a bank giving you a conventional mortgage because 55k is under the minimum mortgage amount banks will borrow. In the eyes of the bank he's the sole earner with 2 dependants.

Realistically the best route to borrow now is financing the shortfall with a personal loan. That's what we did. Yes, it is expensive interest wise but you're done after 10 years and you don't have a loan secured against your house. While the interest rate is high it realistically is the fastest and "easiest" way to get the money you need and if your husband argues his case well he shouldn't have a problem borrowing.

Also get legal advice on your situation not being able to borrow, there might be another way, it's an annoying situation to be stuck in.
Depending on where you live, sometimes local banks offer finance on local properties for good rates because they know property is cheap and people often fall under the mortgage limit.

I wish you all the best!

djan

Would the rebuilding ireland loan be applicable here? http://www.rebuildingirelandhomeloan.ie/

nicol

Some banks will include income from Carer's Allowance when calculating income, try Ulster Bank - they were doing that a few years ago.

Dolbhad

When you are married and house is one spouse’s name, that spouse cannot sell or remortgage the property without the other spouse’s consent consent if it’s your family home. Do note you have to provide a “gift “ letter to bank to get loan offer but they will then require you to sign a deed of confirmation. Ulster Bank will insist you go to independent solicitor (the one not acting for your husband) to sign it saying it’s a gift or if it’s a loan, that the bank comes first on their charge. You would need to take legal advice if you were to proceed when signing this. So you can say it’s a loan but bank will want to ensure they get paid first of house is sold.

But depending on the bank your husband solicitor could see do they would agree to you have registered a right of residence in the property for life. Or potentially if you could register a lower charge in the property. However you are getting the benefit of the property i.e you will live there so Bank may not agree to this considering the rights you have under the various family law acts. But you will need to talk to a solicitor about the best way for you to proceed.

Also credit unions do offer mortgages. Interest rates are high but could be an option.