Saving/Applying for a mortgage 2015/16/17/18/19

EriT · 08-01-2019 9:01am

GingerLily wrote: »

You won't pass the other affordability criteria given your salary, no chance of an exemption that high.

Ah okay . But for example a couple with good wages and no debt could in theory get 4.5 or over ?

Creamy Goodness · 08-01-2019 9:35am

EriT wrote: »

Ah okay . But for example a couple with good wages and no debt could in theory get 4.5 or over ?

Yes, but you’re looking at wages 60k or even higher.

amcalester · 08-01-2019 9:42am

Creamy Goodness wrote: »

Yes, but you’re looking at wages 60k or even higher.

Do banks even give exemptions that high?

Creamy Goodness · 08-01-2019 9:45am

amcalester wrote: »

Do banks even give exemptions that high?

How do you mean that high? Max most will go to is 4.5 times your salary.

If you mean is it possible to get an exemption on 60k, the answer is yes (I was offered one, not needed) but it was in December 2017

amcalester · 08-01-2019 9:52am

Creamy Goodness wrote: »

How do you mean that high? Max most will go to is 4.5 times your salary.

If you mean is it possible to get an exemption on 60k, the answer is yes (I was offered one, not needed) but it was in December 2017

ERiT was asking for an exemption greater than 4.5 times salary, I don’t think banks offer this regardless of (combined) salary.

Offer isn’t the right word but you know what I mean, approve maybe.

GingerLily · 08-01-2019 10:16am

Apparently exemptions higher than 4.5 are allowed, but I would expect that's only offered to people on very high wages, but it's not common.

There are are several ways they check your affordability, and you need to pass the other criteria comfortably if you want an exemption!

EriT · 08-01-2019 10:28am

Interesting thanks . For the record I am looking for an exception but not 4.5 or over.

Creamy Goodness · 08-01-2019 10:28am

amcalester wrote: »

ERiT was asking for an exemption greater than 4.5 times salary, I don’t think banks offer this regardless of (combined) salary.

Offer isn’t the right word but you know what I mean, approve maybe.

ah I get you now, sorry I was still asleep.

as GingerLily says, greater than 4.5 exists (even seen 1-2 mention they got greater than 4.5 on this thread) but they're super rare.

GingerLily wrote: »

Apparently exemptions higher than 4.5 are allowed, but I would expect that's only offered to people on very high wages, but it's not common.

GingerLily · 08-01-2019 11:05am

EriT wrote: »

Interesting thanks . For the record I am looking for an exception but not 4.5 or over.

Does your savings plus rent cover a stresses mortgage payment?

What percentage is your debt (mortgage and other loans) compared to your net monthly income?

How much after your mortgage payment and debts, crèche etc. are you left with each month?

What's your LTV?

There's are the big questions the bank will want to know before granting an exemption. There are more criteria obviously but they're the main ones that particularly affect the exemptions.

EriT · 08-01-2019 12:15pm

GingerLily wrote: »

Does your savings plus rent cover a stresses mortgage payment?

What percentage is your debt (mortgage and other loans) compared to your net monthly income?

How much after your mortgage payment and debts, crèche etc. are you left with each month?

No kids or loans etc

What's your LTV?

90%

There's are the big questions the bank will want to know before granting an exemption. There are more criteria obviously but they're the main ones that particularly affect the exemptions.

1.So we Currently pay rent not far off the mortgage payments we would be looking at (75% of potential mortgage ish) on top of that I have 1500 a month in savings for last 3 months. Previous to those 3 months Saving we had been heavily paying off Credit cards /loans total value of over 1000 a month. I understand this isn't 6 month savings but will the consider the previous 3 months clearing debt ?

2.Currently debt free.

Mortgage would come in under 30% of Net monthly income

3.No kids or loans etc

4.90%.

How do we look ? Mortgage meetings booked for end of next week . We are looking at new builds due to be released in feb

amcalester · 08-01-2019 12:31pm

I’m no expert but I’d imagine that an exemption on the salary multiplier would only be offered to someone with a large deposit.

And, vice versa, an exemption on the deposit would only be offered to someone looking for a low multiple of their salary.

GingerLily · 08-01-2019 12:33pm

Not having 6 months of savings could be a massive issue! Especially as your going for a 90% LTV and looking for a high LTI exemption.

conti · 08-01-2019 12:57pm

Creamy Goodness wrote: »

but it was in December 2017

My understanding was that these were used up early in the year. Does that mean the exemption you were offered was for 2018? I ask because we're entering the market at the end of the year, but I was going to wait until January for that reason.

Creamy Goodness · 08-01-2019 1:02pm

conti wrote: »

My understanding was that these were used up early in the year. Does that mean the exemption you were offered was for 2018? I ask because we're entering the market at the end of the year, but I was going to wait until January for that reason.

I was told by the bank in question, that they staggered their exemptions throughout the year, so say for example they can only have 20% of their entire mortgage book be exemptions, for the mortgage AIP's they were given out at the start of the year was max 1 in 5 mortgages and this allowed them to still give exemptions in December.

This may not be the case anymore, and other banks may vary.

EriT · 08-01-2019 1:04pm

GingerLily wrote: »

Not having 6 months of savings could be a massive issue! Especially as your going for a 90% LTV and looking for a high LTI exemption.

Understood . The release date of our 1st choice property is forcing us to show our hands and apply early otherwise id have waited till 1st April with 6 months savings in the bank .

I'm no expert but I'm hoping we can show that disposable income is quite high given the debt we cleared in the previous 3 months

Creamy Goodness · 08-01-2019 1:10pm

EriT wrote: »

I'm no expert but I'm hoping we can show that disposable income is quite high given the debt we cleared in the previous 3 months

The problem here is the bank won't see it this way. They'll see it as "why did you have this much debt?" and see it as bad financial planning. How will they be sure that other debts won't come into play again given that you have a record of debt. I got the feeling from your posts that the debt wasn't paid off in a timely fashion, if this is the case disregard.

GingerLily · 08-01-2019 1:10pm

EriT wrote: »

GingerLily wrote: »

Not having 6 months of savings could be a massive issue! Especially as your going for a 90% LTV and looking for a high LTI exemption.

Understood . The release date of our 1st choice property is forcing us to show our hands and apply early otherwise id have waited till 1st April with 6 months savings in the bank .

I'm no expert but I'm hoping we can show that disposable income is quite high given the debt we cleared in the previous 3 months

You can always ask

GingerLily · 08-01-2019 1:12pm

If you're debt was educational, then they might not hold it against you, but I can't see them being that impressed if it's just holidays or cars

EriT · 08-01-2019 1:14pm

Creamy Goodness wrote: »

The problem here is the bank won't see it this way. They'll see it as "why did you have this much debt?" as see it as bad financial planning. How will they be sure that other debts won't come into play again given that you have a record of debt. I got the feeling from your posts that the debt wasn't paid off in a timely fashion, if this is the case disregard.

All debt paid off - early with zero missed payments . Nothing out of the ordinary size wise with two small credit card balances and two small personal loans

EriT · 08-01-2019 1:41pm

Thanks for the feedback. One other point I'd like to note is that we would have 6 months savings by the time official mortgage offer would be required . It's the approval in principle piece of paper we are after ASAP . I will post in here when I hear back

whatawaster · 08-01-2019 2:16pm

Is the stressed mortgage repayment calculated as 2% + rate of whatever product you are applying for?

For example, if i applied for an Ulster Bank 2 yr fixed at 2.30%, would that make my stress test payments be 4.30%?

Or do they use a standard variable rate?

GingerLily · 08-01-2019 3:00pm

whatawaster wrote: »

Is the stressed mortgage repayment calculated as 2% + rate of whatever product you are applying for?

For example, if i applied for an Ulster Bank 2 yr fixed at 2.30%, would that make my stress test payments be 4.30%?

Or do they use a standard variable rate?

I think it's usually 2% above the variable rate, try best to assume 6% (EBS website state this figure), to get an upper estimate.

nim1bdeh38l2cw · 08-01-2019 3:01pm

whatawaster wrote: »

Is the stressed mortgage repayment calculated as 2% + rate of whatever product you are applying for?

For example, if i applied for an Ulster Bank 2 yr fixed at 2.30%, would that make my stress test payments be 4.30%?

Or do they use a standard variable rate?

It's 2% on top of the STV which is currently 4.4% for 90% mortgages, so 6.4% is the stressed rate

dudara · 08-01-2019 3:01pm

EriT wrote: »

Thanks for the feedback. One other point I'd like to note is that we would have 6 months savings by the time official mortgage offer would be required . It's the approval in principle piece of paper we are after ASAP . I will post in here when I hear back

AIP requires the full deposit to be saved. The final loan offer only comes once you have selected the actual property and done the final valuations etc.

What you are looking for is the "lightweight" AIP that some banks give out. However, this isn't proper AIP, which needs to be generated by the underwriters.

EriT · 08-01-2019 3:12pm

dudara wrote: »

AIP requires the full deposit to be saved. The final loan offer only comes once you have selected the actual property and done the final valuations etc.

What you are looking for is the "lightweight" AIP that some banks give out. However, this isn't proper AIP, which needs to be generated by the underwriters.

5% deposit (20k+) already saved . I sold an asset last September which covered a big chunk . HTB approved for the other 5%

Exactly . I'm looking for proof of funds to give to the estate agent to secure a house on release date . My finances would be in a better situation by contract signing time i.e I would have 6 months savings ( which actually would be equivalent of monthly repayments ) on top of our rent

Frank Castle · 08-01-2019 3:20pm

EriT wrote: »

5% deposit (20k+) already saved . I sold an asset last September which covered a big chunk . HTB approved for the other 5%

Exactly . I'm looking for proof of funds to give to the estate agent to secure a house on release date . My finances would be in a better situation by contract signing time i.e I would have 6 months savings ( which actually would be equivalent of monthly repayments ) on top of our rent

If you have been paying rent regularly for over 6 months plus have any savings on top of that you should be fine.

I got my AIP with almost no savings (less than 1000) but 2 years of paying rent. (My deposit was a gift). They were happy with the rent showing consistent management of money and stressed tested our income. We got an exemption for 4.5% ourselves, but we did not need it (not sure why they even offered it tbh as we had the house we wanted in mind before applying for aip).

This was with PTSB. I personally had a great experience with PTSB and would recommend going in and talking to them. they will give you a 'light' aip which you can take to the EA and put down your booking deposit. After this you can look for your proper aip.
If you don't get it then your booking deposit is fully refundable

Note: we put our booking deposit in when the house was still at founds level, it was 3 months after the roof went on our house before we actually singed the contacts, you may have more time than you think to save.

EriT · 08-01-2019 3:48pm

Frank Castle wrote: »

If you have been paying rent regularly for over 6 months plus have any savings on top of that you should be fine.

I got my AIP with almost no savings (less than 1000) but 2 years of paying rent. (My deposit was a gift). They were happy with the rent showing consistent management of money and stressed tested our income. We got an exemption for 4.5% ourselves, but we did not need it (not sure why they even offered it tbh as we had the house we wanted in mind before applying for aip).

This was with PTSB. I personally had a great experience with PTSB and would recommend going in and talking to them. they will give you a 'light' aip which you can take to the EA and put down your booking deposit. After this you can look for your proper aip.
If you don't get it then your booking deposit is fully refundable

Note: we put our booking deposit in when the house was still at founds level, it was 3 months after the roof went on our house before we actually singed the contacts, you may have more time than you think to save.

Thanks for the feedback . Have 5ish years of paying rent

PTSB are on the list , they may have moved up a few spots now due to your experience

cant26 · 09-01-2019 12:56am

A friend of mine advised me to start paying our Childminder in cash so that the bank does not know how much we pay in childcare. I’ve been doing this since September in preparation to apply for a mortgage this year, hopefully in the next few months.
Thinking about it now I’m not sure if it’s the right move. Our youngest will be three in August and starting Montessori so our childcare bill will be decreasing dramatically then .
Would it look better to show the bank that we have a chunky childcare bill at the moment but can still meet all of our financial commitments as well as save and that this expense will possibly be halved or eliminated completely come September?
Not sure what to do! Any thoughts?
Also, in relation to mortgage brokers, when do you approach them? I’d love some guidance on a few things, like the above but not sure if they only come into play when you are ready to apply. Any advice?

L1011 · 09-01-2019 1:08am

Huge cash withdrawals will look massively suspicious and could be interpreted as far worse than childcare payments

cant26 · 09-01-2019 9:29am

L1011 wrote: »

Huge cash withdrawals will look massively suspicious and could be interpreted as far worse than childcare payments

Thanks. We pay weekly so the withdrawals are not suspicious.

IJS84 · 09-01-2019 2:17pm

My experience has been good also with PTSB. However this week Ive been pissed with them. Long story short, We went Sale agreed in April 2018, Solicitors have dragged the arse clean out of it on the sellers side (to say the least). We had life etc all in order Late July 2018.
Our solicitor is now trying to draw down funds to close the sale, got a 2nd Valuation done in September as the 1st was out of date & went back to PTSB to re apply as the initial loan offer was due to expire at the end of November '18, everything re approved and contacted the bank again in December to confirm as I knew we were getting close to drawdown and to make sure everything else in order etc

Yesterday we were informed that we have to get more up to date life cover again, I know from our doctors, if another medical is required as with the 1st application, we are looking at possibly another month & Given that this is causing further delays again, we arent happy, as the last valuation being done in September may need to be done again and costing us more money. Add that to our landlord had given us notice in October he is selling up and needs the property back at the end of January we are getting close to the line now.

awec · 09-01-2019 2:25pm

cant26 wrote: »

Thanks. We pay weekly so the withdrawals are not suspicious.

Banks can do arithmetic...

They'll still want to know where all the cash is going.

GingerLily · 09-01-2019 2:30pm

IJS84 wrote: »

My experience has been good also with PTSB. However this week Ive been pissed with them. Long story short, We went Sale agreed in April 2018, Solicitors have dragged the arse clean out of it on the sellers side (to say the least). We had life etc all in order Late July 2018.
Our solicitor is now trying to draw down funds to close the sale, got a 2nd Valuation done in September as the 1st was out of date & went back to PTSB to re apply as the initial loan offer was due to expire at the end of November '18, everything re approved and contacted the bank again in December to confirm as I knew we were getting close to drawdown and to make sure everything else in order etc

Yesterday we were informed that we have to get more up to date life cover again, I know from our doctors, if another medical is required as with the 1st application, we are looking at possibly another month & Given that this is causing further delays again, we arent happy, as the last valuation being done in September may need to be done again and costing us more money. Add that to our landlord had given us notice in October he is selling up and needs the property back at the end of January we are getting close to the line now.

I don't know if it's entirely your banks fault, the life cover is an external company! If its Irish Life then I can understand your frustration, we went with them and they were nothing but trouble, the most stressful part of the process by a mile.

IJS84 · 09-01-2019 2:38pm

GingerLily wrote: »

I don't know if it's entirely your banks fault, the life cover is an external company! If its Irish Life then I can understand your frustration, we went with them and they were nothing but trouble, the most stressful part of the process by a mile.

Ya we have done. To be fair to the bank and Irish Life though, all the delays have come from the sellers solicitors. we went sale agreed in April 2018, we didnt get contracts to our solicitors until November...hence we chased the reapproval etc then to, what we thought was to streamline things on our end.
Meeting with the bank tomorrow so hopefully we can tie things up then

Creamy Goodness · 09-01-2019 2:55pm

awec wrote: »

Banks can do arithmetic...

They'll still want to know where all the cash is going.

it'd be pretty bad if they couldn't after all these years

tbh trying to hide anything from the bank is pretty shady and will just raise more questions than prevent them.

09-01-2019 9:40pm

I am considering a bid on a house at the moment that needs some work. If the bid was accepted, would it be possible to get someone in to price the work before actually closing the sale? We'd obviously have a limited budget for renovations so if we learned it would be much more expensive than expected it might change our decision. Anyone with experience of something like this?

tobsey · 09-01-2019 9:51pm

IJS84 wrote: »

Ya we have done. To be fair to the bank and Irish Life though, all the delays have come from the sellers solicitors. we went sale agreed in April 2018, we didnt get contracts to our solicitors until November...hence we chased the reapproval etc then to, what we thought was to streamline things on our end.
Meeting with the bank tomorrow so hopefully we can tie things up then

Can you reduce the amount of the mortgage? Have you managed to save more since April? If you had drawn down the mortgage straight after getting life cover then you would have paid very little principal back since. So if ou can draw down a bit less and set the duration to one year less your mortgage protection should be valid. That might be quicker and easier to arrange with the bank than going through the life cover process again.

heebusjeebus · 09-01-2019 9:56pm

Ayan Prickly Road wrote: »

I am considering a bid on a house at the moment that needs some work. If the bid was accepted, would it be possible to get someone in to price the work before actually closing the sale? We'd obviously have a limited budget for renovations so if we learned it would be much more expensive than expected it might change our decision. Anyone with experience of something like this?

Bring a builder to see the house before you bid.
I went to many viewings where work was needed and in some cases, the estate agents suggested a builder or engineer should also attend viewing.

chrismon · 10-01-2019 12:51am

IJS84 wrote: »

My experience has been good also with PTSB. However this week Ive been pissed with them. Long story short, We went Sale agreed in April 2018, Solicitors have dragged the arse clean out of it on the sellers side (to say the least). We had life etc all in order Late July 2018.
Our solicitor is now trying to draw down funds to close the sale, got a 2nd Valuation done in September as the 1st was out of date & went back to PTSB to re apply as the initial loan offer was due to expire at the end of November '18, everything re approved and contacted the bank again in December to confirm as I knew we were getting close to drawdown and to make sure everything else in order etc

Yesterday we were informed that we have to get more up to date life cover again, I know from our doctors, if another medical is required as with the 1st application, we are looking at possibly another month & Given that this is causing further delays again, we arent happy, as the last valuation being done in September may need to be done again and costing us more money. Add that to our landlord had given us notice in October he is selling up and needs the property back at the end of January we are getting close to the line now.

April 2018!
That's crazy, we went sale agreed in December and hope to get the keys in the next month.
Hope you get sorted soon.

10-01-2019 1:15pm

Hi All,

We received a cash gift from parents towards a deposit. Are we likely to be viewed with any chance if we cannot show savings records ourselves. Ie The full deposit is met be cash gift?

10-01-2019 1:20pm

It depends. If everything else is fine you might be grand.
They will ask for a declaration from your parents that is a gift and not to be returned.

If you are looking for an exemption or say aren't paying rent now it might be a problem.

GingerLily · 10-01-2019 1:21pm

Analia Harsh Ketchup wrote: »

Hi All,

We received a cash gift from parents towards a deposit. Are we likely to be viewed with any chance if we cannot show savings records ourselves. Ie The full deposit is met be cash gift?

What level are rent are you paying compared to what your mortgage payments will be?

If you're not paying rent and your not saving then the banks won't give you a mortgage because you have no history to show that you could handle paying a mortgage.

Frank Castle · 10-01-2019 1:38pm

Analia Harsh Ketchup wrote: »

Hi All,

We received a cash gift from parents towards a deposit. Are we likely to be viewed with any chance if we cannot show savings records ourselves. Ie The full deposit is met be cash gift?

My full deposit was a cash gift (well 5%, other 5% was HTB)

Its not a problem provided you have the income to pass their stress test and have some form of consistent money management such as paying rent.

You will need your parents to sign a letter with a solicitor saying that the money is a gift and they have no stake in the house due to that money. (Wait until the bank asks for this letter before getting it)

Charlie · 10-01-2019 2:57pm

Question for those with a bit of experience on the CBI lending exemptions.

My partner and I are starting to look as first time buyers. We have anticipated that we would look for an exemption as we reckon we’ll want to borrow 4 times our joint income.

Speaking with BOI today, they advised that an exemption can only be granted for a specific property and the exemption is only valid for that property.

Is this the case with all the lenders, and if so, how does this work in practice when you’re viewing properties? Surely the estate agent will want proof that you’re approved for the exempted amount?

Or is it a case of bidding on the house, going sale agreed, and then going to your bank for an exemption?

‘tis all very confusing.

Creamy Goodness · 10-01-2019 3:02pm

BOI and KBC were two banks that requested a specific property before giving an exemption.

AIB however did not. This is my experience, yours may vary.

derekbro · 10-01-2019 3:13pm

Charlie wrote: »

Or is it a case of bidding on the house, going sale agreed, and then going to your bank for an exemption?

For me through a broker, KBC and Haven(AIB) gave an exception for AIP, Ulster bank requested a particular property.

Frank Castle · 11-01-2019 11:35am

Just as an update, as I forgot to post it before.

Got the cashback from PTSB after 2 weeks. (in case anyone is wondering)

Can be hard to get this information as people tend to stop posting once they get their keys!

Misssally · 11-01-2019 6:05pm

Hoping to apply for a mortgage soon & have built up 6 months of saving to show affordability (in addition to existing morg repayments) however I’ve a credit card with a balance of €2k that I’m paying off, I’d like to take the 2k from savings (€4.5k) at the moment& pay it off (it’s closed I’m just paying the balance) but would that impact showing my ability to repay? Deposit is coming from existing property & I plan to apply the end of March? Not sure what the best thing to do is?

soc · 11-01-2019 9:11pm

Misssally wrote: »

Hoping to apply for a mortgage soon & have built up 6 months of saving to show affordability (in addition to existing morg repayments) however I’ve a credit card with a balance of €2k that I’m paying off, I’d like to take the 2k from savings (€4.5k) at the moment& pay it off (it’s closed I’m just paying the balance) but would that impact showing my ability to repay? Deposit is coming from existing property & I plan to apply the end of March? Not sure what the best thing to do is?

I really don't understand why you have savings and still have a credit card debt. Having a debt like that is unnecessary and it would actually look better to have no credit card debt...the ability to repay loans to a bank only really matter to long term loans (like car). Be rid of the cred card debt straight away then focus back on savings.

If anything what you should do is use the credit card every month but make sure pay it off entirely when you get the statement in every month...that would have more positive response from bank as it shows that you can live within your means and pay credit card bill. Do not carry credit card balance and save

Creamy Goodness · 11-01-2019 10:26pm

soc wrote: »

If anything what you should do is use the credit card every month but make sure pay it off entirely when you get the statement in every month...that would have more positive response from bank as it shows that you can live within your means and pay credit card bill. Do not carry credit card balance and save

Telling a person who has credit card debt to use their card more isn’t really the best advice.

Saving/Applying for a mortgage 2015/16/17/18/19

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