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When Does Your Mortgage Expire

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  • 07-11-2019 9:43pm
    #1
    paul7g
    Registered Users Posts: 266 ✭✭


    Hi,

    I'm in the process of buying a house, and like most house purchases, the seller can take longer than anticipated to get their particulars in order.

    I'm concerned that my mortgage approval will expire before the seller manages to organise everything on their end.

    What constitutes as drawing down the funds in the required timeframe?

    A - draw down on contract signed

    B - draw down on receipt of keys

    C - other

    For example, if the expiry date is Dec 31st 2019, and the contract is signed mid Dec but I don't get the keys until end of Jan, where does the expiry date fall into play.

    Basically, at what stage do you officially avail of the funds and deadline?

    Thank you in advance for your help.


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    #2
    drinkingwater
    Registered Users Posts: 128 ✭✭drinkingwater


    Few days before receiving the keys


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    #3
    Samuel T. Cogley
    Registered Users Posts: 10,684 ✭✭✭✭Samuel T. Cogley


    Usually they're quick enough to extend if you're going through the motions on a property.


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    #4
    tomister
    Registered Users Posts: 271 ✭✭tomister


    paul7g wrote: »
    Hi,

    I'm in the process of buying a house, and like most house purchases, the seller can take longer than anticipated to get their particulars in order.

    I'm concerned that my mortgage approval will expire before the seller manages to organise everything on their end.

    What constitutes as drawing down the funds in the required timeframe?

    A - draw down on contract signed

    B - draw down on receipt of keys

    C - other

    For example, if the expiry date is Dec 31st 2019, and the contract is signed mid Dec but I don't get the keys until end of Jan, where does the expiry date fall into play.

    Basically, at what stage do you officially avail of the funds and deadline?

    Thank you in advance for your help.

    Its the date at which the mortgage funds are transferred to the solicitors account. Depending on the bank this can take a couple of days from when the solicitor requested it.
    Keys won't be handed over until the funds are transferred to the vendor's account


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    #5
    paul7g
    Registered Users Posts: 266 ✭✭paul7g


    Thanks all.

    What is the milestone required to actual draw down or transfer funds.

    Is it on signature of contracts, or is there a different milestone that initiates this?


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    #6
    tomister
    Registered Users Posts: 271 ✭✭tomister


    paul7g wrote: »
    Thanks all.

    What is the milestone required to actual draw down or transfer funds.

    Is it on signature of contracts, or is there a different milestone that initiates this?

    If it’s a new build it’s generally once snagging takes place and you’re happy that the snag list has been completed. On a second hand property it’s prior to your closing date in the contract although this can slip.


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    #7
    mcbert
    Registered Users Posts: 460 ✭✭mcbert


    I have 6 month approval in principle with BOI, got throught a broker. I asked them what stage we need to reach before the expiry date - they told me we need to be sale agreed and to notify BOI that we are sale agreed by that date - no mention of drawing down funds by that date


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    #8
    Dolbhad
    Registered Users Posts: 782 ✭✭✭Dolbhad


    You generally get approval in principle first. This can be valid for 6 months up to 12 months depending on bank. When you go sale agreed a loan offer issues. That’s valid for 6 months. You want to draw down mortgage within that 6 months. If new build you may need to reapply for mortgage. If your very close to a closing date, banks can extend it for a week or two.

    Your solicitor will request funds about a week before closing. Your mortgage is activated then once funds are released to your solicitor. Your first payment should be a month after that depending on direct debt mandate date


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    #9
    paul7g
    Registered Users Posts: 266 ✭✭paul7g


    Dolbhad wrote: »
    You generally get approval in principle first. This can be valid for 6 months up to 12 months depending on bank. When you go sale agreed a loan offer issues. That’s valid for 6 months. You want to draw down mortgage within that 6 months. If new build you may need to reapply for mortgage. If your very close to a closing date, banks can extend it for a week or two.

    Your solicitor will request funds about a week before closing. Your mortgage is activated then once funds are released to your solicitor. Your first payment should be a month after that depending on direct debt mandate date

    Ok great, thanks.

    I guess I should ask, what constitutes as ‘closing’. I find the lack of clarity in the whole process frustrating.

    I’ll explain where I am currently at, and would greatly appreciate if someone could help or advise on the steps required from here in.

    1. I have signed the loan offer with my solicitor, however he is back and forward with the seller’s solicitor on a few things on the contract

    2. The full balance of the deposit has been transferred to my solicitor

    What other milestones are required before you get the keys, if everything goes to plan.

    Thanks again for your help on this.


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    #10
    tomister
    Registered Users Posts: 271 ✭✭tomister


    paul7g wrote: »
    Ok great, thanks.

    I guess I should ask, what constitutes as ‘closing’. I find the lack of clarity in the whole process frustrating.

    I’ll explain where I am currently at, and would greatly appreciate if someone could help or advise on the steps required from here in.

    1. I have signed the loan offer with my solicitor, however he is back and forward with the seller’s solicitor on a few things on the contract

    2. The full balance of the deposit has been transferred to my solicitor

    What other milestones are required before you get the keys, if everything goes to plan.

    Thanks again for your help on this.

    Closing would be defined as payment transferred to the vendor's solicitors and the keys handed over to the buyer.

    In terms of milestones it differs depending on new build or second hand house.
    For a new build the process would be; valuation --> snag --> works completed from snag --> drawdown --> handover of keys.

    For a second hand house as you are at contract stage I would imagine you've had a survey carried out already. If this is the case then it is drawdown on the closing date agreed with both parties and handover of keys.


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    #11
    Dolbhad
    Registered Users Posts: 782 ✭✭✭Dolbhad


    paul7g wrote: »
    Ok great, thanks.

    I guess I should ask, what constitutes as ‘closing’. I find the lack of clarity in the whole process frustrating.

    I’ll explain where I am currently at, and would greatly appreciate if someone could help or advise on the steps required from here in.

    1. I have signed the loan offer with my solicitor, however he is back and forward with the seller’s solicitor on a few things on the contract

    2. The full balance of the deposit has been transferred to my solicitor

    What other milestones are required before you get the keys, if everything goes to plan.

    Thanks again for your help on this.

    “Closing” means the deal is done - you get keys and house is yours. Until you’ve money from the bank and keys in your hand, there is always the possibility of something going wrong.

    Nothing is binding until you have signed contracts in place between you and the seller. Either party can walk away until then. Even if you have signed contracts and paid deposit, the seller can decide not to go ahead and pull out. Have you signed contracts and been returned to seller? Has the seer sighed contracts and returned them to your solicitor? Or have you signed them and your solicitor is holding off returning them until all queries are answered?

    So you need signed contracts, a closing date, to put the non legals in place eg house and life insurance. A week before the estimated closing date your solicitor will request funds from bank and balance of funds from you (ie their bill, stamp duty).

    To be honest your solicitor should have gone through all of this with esp if you’ve been into to sign stuff. My solicitor had gone through all the stages when we first went sale agreed and before anything happened.

    As previous posted highlighted, with second hand house survey report should be carried out before you sign contracts. With new build, snag list should be carried out before funds are requested and sale closing.


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