mortgage and declined DD

chokzdgreat

hi good day everyone. i just have q question regarding mortgage. me and my wife are planning to buy a house, we're currently got our AIP and is ready for house hunting. however im a bit worried coz based on my statements i have dclined direct debits anf payments from such of amazon subscription, spotify and sometimes the waste bin payment. its because i always forget the due time and put all my money to my savings account. Will this affect the mortgage full offer in the future? we are currenlty saving religiously every month. Hope someone can enlighten me. thank you!

patmahe

Its a decade since I did this but I'd imagine there will be some sort of threshold for this, if it happened x number of times or over X amount. It can be an indicator of mismanagement but I can't imagine it's enough to reject the application, especially if you can show you placed the money in savings rather than spent it down the pub.

The only absolute Nono we were told about was transactions that indicate a history of gambling.

chokzdgreat

hi its just really stupid mistake of forgetting its due and we usually pay it a soon as we notice it. also we had all our money on savings account thats why it gets declined.

Kalimah

Unfortunately this may come back to bite you. I worked in banking for many years, and accounts with missed payments showed either a very limited income or a casual approach to money management, You’d want to have minimum 6 months of squeaky clean accounts for the bank to approve a mortgage for you.

chokzdgreat

i will. thabks

Fann Linn

Just some helpful advice, I've lots of subscriptions Amazon, Now TV etc plus direct debits IE Flogas , Eir, etc.

I have them all on my Google calendar and a quick glance on a weekly or daily will show you what's coming.

Good luck with your mortgage application 👍.

Princess Calla

They will look at 6 months bank statements.

However I don't see a valid reason for clearing your current account to such a level that direct debits and regular payments are being rejected.

What's to say the mortgage direct debit won't be rejected too?

These are agreed, I presume monthly subscriptions. Are you incurring charges each time they fail too?

There's zero point transferring money to savings when you have to transfer it back out a few days later. It looks like window dressing....underwriters don't like window dressing.

Tot up all your monthly payments and keep a float of that amount and probably a bit extra in your current account at all times.

A current account with a balance close to zero would ring alarm bells....you need to be able to pass a stress test.

cml387

Do you actually need Spotify and Amazon subscriptions?

Jim2007

https://www.boards.ie/discussion/comment/122823192#Comment_122823192

Well the reality is that it is your responsibility that you have sufficient funds on your account to meed the direct debits. This is basic stuff, you know the payments are due, you know your money is on your savings and you have not made it your business to make sure the cash is moved across. This goes to your ability to manage your account according to the terms you signed up to. Now you are asking them to trust you in operating an even more risky account with a history of non compliance! If it happened once or twice over a few years, it's a mistake, if it happens more often it's carelessness.

That said it is just one point on a banks evaluation model, so provide all the rest is in order and the loan's officer has a reasonable perception of the human condition, it will probably work out OK. But you really need to make a change in your approach to managing your account so you can at least argue if necessary that you've learned the less on and have a couple of good months behind you.

chokzdgreat

hi thansk for this advice. yeah really now i realized that its really important. its just a bit a culture shock to me as im not from this country originally and in our country credit system is not really a thing. thanks again!

chokzdgreat

spotify yes but amazon im thinking to dc it

chokzdgreat

i jus didnt know really that its that a big deal. stupid of me. but as per my personal loans everything is paid on time.

chokzdgreat

hi thank for this advice if just done this now 😊

Jim2007

https://www.boards.ie/discussion/comment/122825594#Comment_122825594

NP. You should also ask for a copy of your credit report from the CCR (https://www.centralcreditregister.ie/) as well just in case there is anything there that would cause problems.

I would not expect there to be anything, but a failed DD of over 500 Euros (I'm not sure of the amount, but no doubt someone will correct me if I'm wrong) is a reportable credit event and financial institutions are obliged to report it to the CCR.

chokzdgreat

i thanks. no its just the subscriptions. nothing over 50 euros. thanks again have a good day!

Princess Calla

As a side note, look into life assurance/mortgage protection while your mortgage application is going through.

These policies can take a while to underwrite. As you are from another country if the underwriters look for additional information from your Dr it may take a while for it to be received etc.

You won't be able to draw down your mortgage until life cover is in place so best to get ducks in a row sooner than later.