Saving/Applying for a mortgage 2020-22 Edition

LeeroyJ.

Thanks for all the help to everyone here. I have one last question, and I'll use hypothetical numbers for it.

Let's say I have 100k saved, and am approved for 500k by the bank. What is the guideline on how much of that 500k should be used to buy the property? 80%? 90%? Im asking because I would also need money for stamp duty, solicitor and so on, correct? Or do I need that in extra saving on top of the 100k that will be used for the down payment?

Iris11111

https://www.boards.ie/discussion/comment/117904377#Comment_117904377

Stamp duty, solicitor expenses are on you not on the bank. If you are a FTB you need 10 % from your 100K and then the rest 90 % of the bank approval of the price of the house. All stamp duties, solicitor expenses evaluator, surveyor it is all on you. It all depends where the house is - as the prices different areas are different ( solicitor, surveyor etc.)

The bank may approve you for 500K but they will only lend out those 90 /80 % ( FTB/STB) that will match the price of the property.

LeeroyJ.

https://www.boards.ie/discussion/comment/117904417#Comment_117904417

Thanks a lot for the explanation! This process is so confusing, :) Really appreciate it!

Blaa.boy

Hi Just wondering is it possible to draw down early before closing date? E.g. house ready end of October and drawdown end of September so funds with solicitor and ready to go?

macnug

https://www.boards.ie/discussion/comment/117901794#Comment_117901794

Took about a week for me.

tobsey

https://www.boards.ie/discussion/comment/117910362#Comment_117910362

If it’s a new build the bank mightn’t release the funds until it’s complete as the house won’t be at its full market value until it’s complete. If it’s second hand then you probably could, but a months interest is very expensive if you’re not living in the property.

Blaa.boy

https://www.boards.ie/discussion/comment/117910551#Comment_117910551

Thanks for information. Its a new build so that's good to know. 👍

sillysocks

I asked this on a property thread but might be more relevant here….

Has anyone any experience in the bank needing to “qualify the title” on a new house and how long that can take? Have come up against it, and it’s a small issue so hopefully not complicated, but know it will take time but no idea how long?

macnug

https://www.boards.ie/discussion/comment/117912516#Comment_117912516

Where at that stage now but with a second hand property. Solicitor send the bank the information to the bank and then the bank responds so it depends on how long it takes both parties, if its a small issue and the bank accepts then it should be a couple of weeks. If the bank does not accept the issue then how long is a piece of string.

Im both buying and selling a property, both have issues and my solicitor expects to close in about 6 weeks all going well.

kippy

https://www.boards.ie/discussion/comment/117912516#Comment_117912516

It does depend on the qualification and whether ther bank require furture documentation.

The most common type of "qualification" I've seen is when the development/estate/shared areas haven't been taken in charge by the council and there is no "formal" management company in place - maybe a residents association or otherwise.

The bank can sometimes look from something from the residents committee to outline exactly what their responsibilities etc are (this is usually pushed back on the vendors solicitor IF it is required.

I've seen qualification as be as little as a couple of weeks delay but my experience is fairly limited.

sillysocks

https://www.boards.ie/discussion/comment/117912571#Comment_117912571

Sorry I said “new” house but it’s second hand. New to us!

An issue with planning certs and docs for an extension. Planning in place but not all docs. Can’t be fixed so needs to be qualified.

Closing has already been delayed two and a half months for various issues and now this has come to light so very frustrating. Would love if banks were more transparent with timelines!

HairySalmon

I’ve recently started a new job with a bigger, better performing multinational and haven’t changed fields, could these factors exempt me from needing to wait until the end of my probation with AIB?

Sniipe

Hi all, I have a tracker mortgage and am looking to switch property. With AIB I can keep my tracker rate plus 1% in addition.

My new house (2nd hand property) will require more money. Is it possible to keep the tracker plus 1% with AIB and to use someone else like ICS Mortgages (cheapest variable on switcher.ie)?

If so where would my house deeds be kept?

JimmyVik

https://www.boards.ie/discussion/comment/117912601#Comment_117912601

Ive seen a few cases where the planning has been granted but the plans for that have been lost by the authorities and are so old the current owner doesnt even have a copy anymore. Your solicitor will do their best to get them to find the plans, but if it turns out they cant be found its just a case of, we know there is planning, planners sent us a letter saying they know there is planning. Go ahead with the sale and dont worry about it. Noone is going to come telling you to know it down.

Pussyhands

https://www.boards.ie/discussion/comment/117904377#Comment_117904377

As far as I understand, how much you have saved doesn't matter.

You need 10% deposit for FTB.

Mortgage amount is 3.5 times your salary.

So your 500k has to be 90% of the sale price.

Pussyhands

https://www.boards.ie/discussion/comment/117913053#Comment_117913053

Friend of mine changed companies in construction industry and it was no problem.

HairySalmon

https://www.boards.ie/discussion/comment/117914895#Comment_117914895

Good to know since that’s been a bit of a volatile industry since COVID!

Emma2019

https://www.boards.ie/discussion/comment/117914890#Comment_117914890

This is incorrect. You can put as much additional cash towards a house purchase as you want.

The maximum a bank will lend is 3.5 times salary, and you need to have a minimum of 10% of the property as a deposit (if FTB).

If you have 100k saved and approval for 500k you can buy a 600k house (ignoring fees and stamp duty).

In reality you can buy a house of around 585k as you will have to pay 5,850 stamp duty and around 3,500 for legal fees and it is usually a good idea to have some spare cash for emergency works plus if you have to buy any appliances.

Also just to add, you dont need to have all your money when you go sale agreed. You'll only need to have it all for drawdown so you can use the interim between sale agreed and drawdown to save for the stamp duty and solicitor fees etc

Dodge

https://www.boards.ie/discussion/comment/117914617#Comment_117914617

No, you can’t have mortgages with two separate companies.

so your choice is AIB with the current tracker +1 for what’s left of your mortgage and a top up of ‘new’ mortgage from AIB at whatever rate they offer for that portion of the mortgage

or

new mortgage from different company at whatever rate you can get

Jasna1982

Hey guys,

Two separate questions:

1. I put a booking deposit down on a new build. Contracts are due in October. I have everything sent in to the bank for my letter of offer, but the only thing that's missing is a house number. The bank needs it to issue letter of offer, and the estate agent doesn't have it yet. Am I right in assuming that when the contract is sent, it will include the house number? I'm guessing since you sign a contract specifically for your house, it should include the full address.
2. Drawdown most likely won't be until April next year, and that's at the very earliest. I'm expecting some delays. If I were to spend some money on a vacation for the end of this year, would the banks look unfavourably at that? I have more than enough saved to cover the deposit, solicitor fees, stamp duty and the cost of furniture and still have a decent amount left. So financially I can do it. I'm just wondering if the bank will have a problem if I spend 3 grand on a holiday in November

Pete123456

https://www.boards.ie/discussion/comment/117916394#Comment_117916394

1. Correct, the contract will include the full address and likely a map indicating which house/plot
2. Generally the bank will have no issue if you show a good track record of saving and show you can manage your money - as long as you can show you have the affordability there’s no issue spending money - you’ll find you’ll need to put down deposits for things etc

Iris11111

Drawdown today - keys by Friday. Major delay in drawdown at the moment with the banks - but after 10 days of chasing they released the funds today.

This forum was a major help for information through the steps of the journey. Thanks to everybody for sharing - very helpful.

Sniipe

https://www.boards.ie/discussion/comment/117916301#Comment_117916301

Thank you for the reply Dodge, AIB has confirmed the same with me. It makes sense.

Interested Observer

What is the norm for paying a solicitor for conveyancing? I have an itemised quote that includes professional fees, searches, registry fees etc. I was thinking the associated fees up front and the professional fees on completion would be reasonable? The solicitor has given no info on how they usually are paid. I can obviously ask them but wondering what others have done.

Pete123456

https://www.boards.ie/discussion/comment/117919205#Comment_117919205

It probably varies, but I would expect a certain amount or percentage upfront and then the balance upon drawdown or some variation of that - I wouldn’t pay them the whole lot upfront because then there’s no motivation for them to respond to your queries etc, no different than any other service you would hire. Not that they will be any quicker without paying them - many solicitors will give you the bare minimum either way.

In our case I think €200 up front and then the balance upon drawdown.

Bannasidhe

https://www.boards.ie/discussion/comment/117919205#Comment_117919205

Friend of mine just paid €500 up front. Quoted price for solicitor fees was around €1,500 . Estimated cost including all the the 'add ons' like stamp duty, searches etc was about €5,200 afaik.

evancunny95

My partner and I are in the very early stages of applying for a mortgage, and if the process wasnt complicated enough as it is, my partner is a German national who lives and works in Germany. Our plan if we manage to buy a home is for her to continue working in her job and commute back and forth to Germany until her contract expires. The commute isnt an issue life style wise as her job is very flexible remote working etc but I am wondering what kind of impact or issue this could cause in our joint morgage application.

My thinking is that these sorts of issues must occur across the EU where citizens work in one state but live and draw down a mortgage in another and surely it must even hapen here around the border with the North. I reckon the best way forward is to talk to a mortgage broker but I just wanted to see if anyone else has been through similar and what their experience was.

Thanks!

OscarBluth

https://www.boards.ie/discussion/comment/117924298#Comment_117924298

I think the biggest issue you'll have is that it sounds like she has a fixed term contract and isn't a permanent employee: that was the biggest sticking point when we were in a similar situation. If memory serves we had to provide all bank statements from all accounts held in the other country, contract of employment, possibly even a letter from employers. If it was the UK, some banks discount for currency fluctuations, which obviously doesn't apply: they may take into account commuting costs. But it was manageable. We didn't use a broker, we just approached our bank to see if it was a possibility and went with them: a broker might make the process smoother.

evancunny95

https://www.boards.ie/discussion/comment/117924395#Comment_117924395

Thank Oscar, good to hear that at the very least it can be done. I had a feeling that there would be a lot more documentation needed, was even wondering whos respobsibility it would be to have that translated. I think the contract thing may just be how the Germans opperate with lecturers in universities as she tells me that she is actually classified as a public sector worker and has quite a long contract compared length to the standard for most lecturers.

I agree that probably laying everything out clearly to a mortgage broker and letting them do the explaining each time is probably the easiest way to go! Thanks again

Blaa.boy

Does anybody know if it's possible to sign contracts before loan offer. Have AIP it's requested but might not be in by deadline that allows additional extras in new build. Thanks