My second mortgage journey! 2022-2024??

Cork2021 · 03-04-2022 2:45pm #1

Hi,

my wife and I have decided we want to upsize and buy our second and all going well final home. We bought in 2016 a 3 bed end of terrace new build approx 95sq metres for €115,000 in a commutable town about 45 mins from Cork City/Killarney and about 60mins to Limerick.

over the past few years we’ve got married and have 2 beautiful kids. Since our second arrived last year we’ve found the house small. Storage, lack of a utility room, kitchen size/living area, rooms aren’t huge for the likes of good storage going forward. For example a double bed would nearly take up all of the box room. Also no area in our kitchen can we put a dishwasher(no need anyway but just an example of the size) when we bought this house we had a combined gross income of €40k. Now that’s approx €85000 now herself is a term time worker so will need to sign on for 8 weeks of the year, I’m not sure is this and child benefit included as income?

so since February this year we’ve committed to clearing a couple of small loans and clear our credit card balance.

we do have one pcp contracted car which was needed last year so that won’t be cleared. We also have a home improvement loan which ive topped up to clear the small loans, probably bad practice but I’ve cut my monthly payments by €75 a month by only paying the home improvement loan for an extra year.

So as a whole our car and loan a month together will be €940, current mortgage monthly is €415 balance of €95000 left to pay, house valuation recently €215-230k if we were to sell now. That’s variable of course and as time goes by our mortgage balance gets lower as well. We’re now saving €520 a month into our credit union and also I set up a goal saver account with BOI of €200 a month. So there’s a possibility that we could have gross profit €120-135k if we were to sell.

a question I do have is with this considerable gross profit we’d have plenty for a 20% deposit with plenty left over. Is there a way of an agreed with a bank that we clear our home improvement loan as part of a mortgage package? Especially if we were to stay put with BOI, obviously not ideal but as an ease of stress it might be the best way.

also we have childcare costs currently of about €650 a month(won’t be in crèche once the wife is off during summer Easter etc) that figure is to increase in September as we don’t qualify for NCS only the minimum amount of 50c per hour. So it’ll mean that €650 will turn into €850 roughly. Is there a way of hiding this by ways of paying cash? We pay weekly by DD, it would be say 3 different cash withdrawals and then cash at the end of the week. Is that bad practice?

I hope some here will have some of the answers to the questions which are wide ranging. Thanks Cork2021

Cork2021 · 05-04-2022 8:06pm

Has anyone had any experience of the above or something similar?

05-04-2022 10:26pm

Spoiler: this post won't be helpful.

You've used the term 'bad practice' twice. Bad practice is when you do something unwise or inefficient. Leaving all your lights on at night is bad practice.

What you've described in both scenarios is not 'bad practice', it's fraud. Lying to your bank in order to obtain credit under false pretenses is fraud.

phormium · 05-04-2022 10:32pm

There is no problem clearing your existing top up loan from surplus proceeds of your house sale and depending on income it is likely the bank would make it a condition of the new mortgage anyway, very common practice.

Can't answer about your creche issues though, are you sure the amount causes you problems income wise?

Cork2021 · 05-04-2022 10:33pm

https://www.boards.ie/discussion/comment/118886319#Comment_118886319

Fraud is a bit far but taken on board!

Cork2021 · 05-04-2022 10:36pm

https://www.boards.ie/discussion/comment/118886350#Comment_118886350

thought that alright, should have a substantial amount left over after all expenses,

the crèche fees are no issue in terms of our income, it’s the fact some our income might not be included ie the 8 weeks of social welfare and child benefit, it’s €5k that’s possibly not going to be included. You include those our net earnings are €5600 a month

phormium · 05-04-2022 11:00pm

https://www.boards.ie/discussion/comment/118886366#Comment_118886366

I know UB used to include CB even though really it shouldn't be included but don't know how they swung that one but they did! Social welfare in general is not included either unless it's a permanent payment like invalidity for example. Check with a broker maybe which lenders are more inclined to include either of those. Failing that can you ensure that the CB maybe goes into a specific account and then out of that to pay the creche, it kind of ties the two together and shows the offsetting of income/cost.

L1011 · 05-04-2022 11:03pm

https://www.boards.ie/discussion/comment/118886356#Comment_118886356

No, deliberately trying to hide stuff to obtain a loan is fraud alright.

Significant cash withdrawals will be questioned these days, particularly if your day to day spending is all on card as most peoples is now.

Cork2021 · 05-04-2022 11:10pm

https://www.boards.ie/discussion/comment/118886483#Comment_118886483

The social would be permanent enough I’d assume as she’s contracted for 44 weeks of the year 8 unpaid. The account for CB isn’t a bad idea

https://www.boards.ie/discussion/comment/118886498#Comment_118886498

yeah was shooting at a black hole, was seeing if anyone has done it, definitely don’t want to be causing any harm to a future application. It’s the scandalous price of childcare is a balls! Because herself was off most of last year we qualified for NCS. This we won’t, once you go over €60k net income you get feck all. Our bill is €177 a week for 4 days now, will jump to €265 in September 🤪

Cork2021 · 04-05-2023 7:29pm

a year on from my first post and avoiding a fraud conviction. 🤪

we’ve put our house on the Market for €225,000 and have 4 mortgage applications in and are hopeful 2 will give us the full amount of €312,000. My wife was made permanent full time in her job and also received a decent pay rise so our gross income went from €83,000 to €90,000 excluding child benefit. We didn’t pay by cash for the crèche but had to recently take out another loan to fix a leaking pipe and plaster board and re tile a bathroom before we put the house up for sale. Which meant our loan debt stayed very similar to what it was last year but obviously our savings were stable. So all lenders had no issue with this as it helped with repayment ability. We can well afford the mortgage amount above with leaving my car pcp and crèche fees left over.

have a bid €210k on the house already only on the market a week. A couple who are cash buyers and in their late 20’s (wish I had that lying around in my 20’s)

herbalplants · 04-05-2023 9:07pm

https://www.boards.ie/discussion/comment/120555676#Comment_120555676

I would grab that bid from cash buyers if I was you.

youngblood · 04-05-2023 9:21pm

Other than having cash ready to go, why would anyone jump at cash buyers?

Anyone approved for mortgage has the funds? You dont actually get the cash into your hand?

it's not like you get anything extra from a cash buyer or am I missing something major here?

Best of luck with the sale

Cork2021 · 04-05-2023 9:23pm

Not accepting 15k under but it’s a start. I expect to house to sell for around €235k to be honest.

Cork2021 · 12-05-2023 6:01pm

Update,

looks like we’ve got AIP with EBS will know Monday or Tuesday all going well.

our house is now under offer at €228500

€8.5k over asking. A few viewings tomorrow could possibly push it over the €230k mark..

My second mortgage journey! 2022-2024??

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