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Applying for mortgage- status of deposit

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  • 04-07-2019 4:37pm
    #1
    zuhuraswa
    Registered Users Posts: 94 ✭✭


    I am hoping to apply get a mortgage for a house between 190k- 240k. There are some really good houses for sale at the moment ranging between this amount. I so far have 20k in deposit saved and hoping to top the rest up in the coming 2/3 months (keeping in mind that I have extra costs, solicitor, tax, stamp duty etc).

    My problem is there are very good houses that are currently in the market for 190-210k that I actually can't put an offer on as I am not mortgage approved. Ideally, it would be great to be approved for 250k straight away, but I need the couple coming months to top it up. Which is resulting in me losing on some of the houses currently on offer on the lower end of my budget.

    If I apply for a mortgage now and get approved for the lower end of my budget but don't get one of these lower end houses, if I want to re-apply for a higher mortgage in another couple of months (when I have the rest of deposit), will I then be required to re-apply for a mortgage, as if completing an application from scratch?

    Does anyone have any experience on this?


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    #2
    Sarn
    Registered Users Posts: 3,061 ✭✭✭Sarn


    Just apply for the most you are comfortable getting now. In the absence of any debt or a pay rise, adding to your savings will not affect what they will lend you.


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    #3
    zuhuraswa
    Registered Users Posts: 94 ✭✭zuhuraswa


    Thanks Sarn. So it doesn't matter how much deposit you have at hand?


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    #4
    Sarn
    Registered Users Posts: 3,061 ✭✭✭Sarn


    It shouldn’t make that much difference with what you have. If you’re a first time buyer and got the HTB money that would also go towards your deposit.


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    #5
    Dolbhad
    Registered Users Posts: 782 ✭✭✭Dolbhad


    Our first AIP we didn’t have a full deposit yet. Basically bank said the max will give you is X on the basis you have y saved. I didn’t have y saved at the time so in reality I wouldn’t get the full x amount. But if I needed to buy a house there and then I could have taken a lower amount where my savings to date was the 10%. They put in the remainder as a “gift” just to issue the AIP but said for an actually loan offer to issue I would
    Need either a gift of the difference or had saved it in the meantime.


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    #6
    tomister
    Registered Users Posts: 271 ✭✭tomister


    Dolbhad wrote: »
    Our first AIP we didn’t have a full deposit yet. Basically bank said the max will give you is X on the basis you have y saved. I didn’t have y saved at the time so in reality I wouldn’t get the full x amount. But if I needed to buy a house there and then I could have taken a lower amount where my savings to date was the 10%. They put in the remainder as a “gift” just to issue the AIP but said for an actually loan offer to issue I would
    Need either a gift of the difference or had saved it in the meantime.

    Out of curiosity who was your mortgage provider? My bank won’t even entertain an application until I’ve the full deposit plus the extra needed for stamp duty etc and even initially wanted me to have the full 10% with HTB approval


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    #7
    368100
    Closed Accounts Posts: 2,067 ✭✭✭368100


    Dolbhad wrote: »
    Our first AIP we didn’t have a full deposit yet. Basically bank said the max will give you is X on the basis you have y saved. I didn’t have y saved at the time so in reality I wouldn’t get the full x amount. But if I needed to buy a house there and then I could have taken a lower amount where my savings to date was the 10%. They put in the remainder as a “gift” just to issue the AIP but said for an actually loan offer to issue I would
    Need either a gift of the difference or had saved it in the meantime.

    AIP isnt worth the paper its written on though.....nobody would agree a house sale with only it


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    #8
    awec
    Administrators Posts: 53,439 Admin ✭✭✭✭✭awec


    368100 wrote: »
    AIP isnt worth the paper its written on though.....nobody would agree a house sale with only it

    Every single house goes sale agreed against AIP.

    To get further in the process than AIP (i.e. formal loan offer) you need to have a specific house, and nobody is going to get a formal loan offer on a house until they are at least sale agreed.


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    #9
    368100
    Closed Accounts Posts: 2,067 ✭✭✭368100


    awec wrote: »
    Every single house goes sale agreed against AIP.

    To get further in the process than AIP (i.e. formal loan offer) you need to have a specific house, and nobody is going to get a formal loan offer on a house until they are at least sale agreed.

    I know how the process works...but I also know plenty of Estate agents that won't agree sales until final mortage approval is evidenced. Always a chance they won't approve for the specific house and a cash buyer could have been turned away in the meantime.


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    #10
    Dolbhad
    Registered Users Posts: 782 ✭✭✭Dolbhad


    368100 wrote: »
    I know how the process works...but I also know plenty of Estate agents that won't agree sales until final mortage approval is evidenced. Always a chance they won't approve for the specific house and a cash buyer could have been turned away in the meantime.

    I have never had an issue with AIP with houses. It’s not practical to have a loan offer issued for every house. Loan offers can take up to 3 weeks to issue and sure once the bid goes up, you’ve to get a new one. Sellers wouldn’t wait that long to go sale agreed if it takes three weeks for every one to put in a bid.To be honest if cash buyers are around the same price as a buyer with a mortgage, cash buyers will always be picked.

    A seller always runs that risk. Purchaser can change mind or have an issue with an engineer’s report. It can always fall apart until contracts are signed.


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