Mortgage

rottie 11

Just looking for some information about mortgages, I’m working full time and herself is off due to COVID.

We have a joint account in credit union with some savings in it, and we also have our own separate bank accounts but the bank accounts are only current accounts.

What do we need to do next , can we keep saving in the credit union and still go for a mortgage from the bank ? Or do we need to open an actual mortgage savers bank account

Trish56

It doesn't make any difference who you save with once you can provide evidence of regular savings usually over the past 6 months before applying for a mortgage however the lender could ask for 12.

Prospector1989

Once you're consistently saving in the credit union and not dipping in and out of it, I don't see why it should matter. We actually had separate savings accounts (one was high yield so had savings limits) with banks (not specifically mortgage savers) and when it came to getting the mortgage there was no issue. They want to see regular savings and not withdrawing from it.

rottie 11

Thanks for the replies, that’ll save us opening a new account. I think if we both direct debit some money in there weekly then that should stand for us ?

frank730

the key is regular saving, if you can show you are saving fix amount each month for say 6months that would definitely help, doesnt matter where you save. some credit unions are also doing mortgages now

rottie 11

Thanks a mil. Well do that and hope for the best

Top chief

Hi myself and parnter are currently saving for a mortgage I have 10k saved up, my parent wants to give me money to help around 10 to 15k , which I will be paying back in the future. would that be enough ?

Also does the bank just need to see the money from my parent come from there account or can I have it in cash ?

Thanks for your advice.

vikings2012

Top chief wrote: »

Hi myself and parnter are currently saving for a mortgage I have 10k saved up, my parent wants to give me money to help around 10 to 15k , which I will be paying back in the future. would that be enough ?

Also does the bank just need to see the money from my parent come from there account or can I have it in cash ?

Thanks for your advice.

You need 10% deposit as first time buyers. So yes, at present your current savings plus parents gift will be enough to get you a €250k mortgage. This is obviously assuming you and your partner has a combined gross income of €70k.

Just get the folks to transfer cash into your savings account.

Top chief

vikings2012 wrote: »

You need 10% deposit as first time buyers. So yes, at present your current savings plus parents gift will be enough to get you a €250k mortgage. This is obviously assuming you and your partner has a combined gross income of €70k.

Just get the folks to transfer cash into your savings account.

Hi thanks for your help, well I make just over 40k after tax and partner is on 35k before tax we are planning on building on her family land I think we can build a decent house for that the foundation will be done by her dad.

Trish56

If you are getting money from your parents this has to be a gift and they will need to sign a gift letter and state that it's non repayable otherwise you will need to state it is a loan and advise of the monthly repayments agreed.

Most lenders look for this money to be lodged to your account before mortgage drawdown as evidence of balance of funds. It's important to have a paper trail of all monies going into your account.

Top chief wrote: »

Hi thanks for your help, well I make just over 40k after tax and partner is on 35k before tax we are planning on building on her family land I think we can build a decent house for that the foundation will be done by her dad.

Top chief

Top chief wrote: »

Hi myself and parnter are currently saving for a mortgage I have 10k saved up, my parent wants to give me money to help around 10 to 15k , which I will be paying back in the future. would that be enough ? ...................

Top chief wrote: »

Hi thanks for your help, well I make just over 40k after tax .....................

€10k savings with €40k net income and getting deposit loaned to you isn't a fantastic mortgage application. Given the site is free you'll probably be grand as ye are dual applicants but your own situation looks less then strong for a mortgage application.

Trish56

Unfortunately it's not as simple as this to get a mortgage of 250k. With a net salary of 40k and only 10k savings it's possible there may be short term borrowings such as car or credit union loan and the repayments need to be factored in. Also if you have dependents and also pay childcare this will also affect how much you qualify for. You need to prove evidence of repayment capacity over a 6 month period so a 250k mortgage over 30 years stressed repayments would be €1365 so you need to show savings or a combination of rent and savings for this amount over the last 6 months. If you're building and are first time buyers you should also qualify for the Help to Buy Scheme which is 5% of the Purchase Price/Valuation.

If you haven't applied for planning permission I would recommend that you increase your savings as much as possible over the next 4 months.

vikings2012 wrote: »

You need 10% deposit as first time buyers. So yes, at present your current savings plus parents gift will be enough to get you a €250k mortgage. This is obviously assuming you and your partner has a combined gross income of €70k.

Just get the folks to transfer cash into your savings account.

Emma237

Hi, I've been mortgage approved and have been saving consistently for 2 years. I have double the deposit needed for the property that I am sale agreed on. I'm hoping to drawdown in the next month or so. Do I need to continue saving until drawdown? Do the bank reasses you at drawdown? Thanks

Q&A

Emma237 wrote: »

Hi, I've been mortgage approved and have been saving consistently for 2 years. I have double the deposit needed for the property that I am sale agreed on. I'm hoping to drawdown in the next month or so. Do I need to continue saving until drawdown? Do the bank reasses you at drawdown? Thanks

Assuming your large deposit isn't needed to make up the shortfall between min deposit and purchase price and depending why you're having to do it you could be ok.

That's based on your mortgage approval not expiring before drawdown. They won't generally need to reassess your ability to service the debt. One exception to this appears to be banks looking for proof of income. In light of the pandemic banks want to be sure you're still in a position to service any future debt.

Even if they did reassess your finances they are pragmatic. One off payments won't worry them too much. They are interested in your continuing ability to meet payments. If you're going out and buying whites goods and furniture for example it will obviously hit your savings. It's regular income less regular expenses they are interested in. That's why they look for 6 months history. If course it's not all backwards looking but of there are no new regular expenses on the horizon -other than the house -it should not be an issue

numbernine

Hello, are there any online calculators that take into account how much savings you have when calculating how much you can borrow? No option for this on the main banks sites.

Sarn

numbernine wrote: »

Hello, are there any online calculators that take into account how much savings you have when calculating how much you can borrow? No option for this on the main banks sites.

What you can borrow is primarily based on your ability to repay and the LTI multiples. Your savings won’t really make a difference apart from meeting the minimum deposit requirement.

A better LTV might give you a lower interest rate that could help you meet stress testing.

Trish56

Once your mortgage is approved the lender will look for evidence that you are still working and not dependent on the Covid19 subsidy before you drawdown the mortgage. they will more than likely look for a current payslip and proof that you have sufficient savings to complete the purchase. So if the purchase price is 250k and your loan offer is for 225k you will need savings of 25k plus legal fees and 1% stamp duty and depending on the lender may need to provide evidence by submitting a bank statement.

Emma237 wrote: »

Hi, I've been mortgage approved and have been saving consistently for 2 years. I have double the deposit needed for the property that I am sale agreed on. I'm hoping to drawdown in the next month or so. Do I need to continue saving until drawdown? Do the bank reasses you at drawdown? Thanks