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

mirrorwall14 · 08-03-2016 8:34pm

Azalea Screeching Padding wrote: »

I'd personally prefer to be dealing directly with the bank rather than messing around with a broker who is there to make money. Its just a middle man between you and the bank.

I'm guessing a broker is handy when you have any odd circumstances which we do

angeldelight · 08-03-2016 10:31pm

We've just applied through a broker - it was handy filling in one application form and only needing to gather one set of documents to apply to multiple banks

kev22185 · 09-03-2016 5:45pm

+1 here in terms of recommending using a broker. It took Ulster Bank 4 weeks to process our documentation and the offer they came back was far lower than we expected, when we applied ourselves. Our broker had 4 offers in under two weeks and all were closer to what we expected.

Edit to say we didn't pay our broker. He made his money through life insurance commission. We were happy to give him the business as he was great to deal with.

loveisdivine · 09-03-2016 9:11pm

If the people that have offered PM's could please send me their brokers details that would be great. Sounds like it would be a good idea, especially as FTB's.

john the one · 09-03-2016 9:25pm

I went through the bank without a broker, its been drawn out and stressful but i know everything is in place now to settle and hopefully will be moving in in 3 weeks. Survey just done today which came back great.

saram · 10-03-2016 5:22am

What do people consider good savings for a mortgage downpayment per month for a household..

€600 a month.. on the high end or low end of the scale??

athtrasna · 10-03-2016 8:29am

saram wrote: »

What do people consider good savings for a mortgage downpayment per month for a household..

€600 a month.. on the high end or low end of the scale??

Depends on how much of a deposit you need and how soon you want to buy. €7,200 a year will take quite a while to bring near deposit level

mirrorwall14 · 10-03-2016 8:33am

And where and what you want to buy. If it's anywhere near Dublin you'd be waiting a while with that level of savings. Some areas of the country you'd get there pretty fast assuming you wanted a simple house and not a four bed detached!

Glen_Quagmire · 10-03-2016 10:25am

I'm saving 800 a month a the moment and hoping to buy in North West Dublin if possible on a single salary. Feels like an impossible task with the current mortgage lending rules and house prices

Captain Chaos · 10-03-2016 10:30am

Glen_Quagmire wrote: »

I'm saving 800 a month a the moment and hoping to buy in North West Dublin if possible on a single salary. Feels like an impossible task with the current mortgage lending rules and house prices

I'm in a similar situation, currently saving around €1,200 per month and looking to buy almost anywhere in Dublin on a single income.

With the new rules I'm going to need about a 50% deposit. It's going to take a while.

angeldelight · 10-03-2016 10:51am

Also when the bank looks at your repayment capacity they want to see you saving and/or paying rent to the amount of the stressed mortgage repayment

SarahMollie · 10-03-2016 11:08am

angeldelight wrote: »

Also when the bank looks at your repayment capacity they want to see you saving and/or paying rent to the amount of the stressed mortgage repayment

+!

The best way is to start talking to them early (either bank or broker) so then you know what you need to be putting aside.

Factors like age are going to impact the term that they'll offer you the money over.

Because I was under 30 they automatically wanted me to take a 35 year mortgage as it their eyes that limited the risk. I'm over paying now so I'll have it cleared long before then and save myself some money in interest. Still its good though because if for whatever reason I want to go back to paying the lower amount (ie whats actually due every month) I can. I think its pretty flexible.

Glen_Quagmire · 10-03-2016 11:19am

Captain Chaos wrote:

I'm in a similar situation, currently saving around â‚¬1,200 per month and looking to buy almost anywhere in Dublin on a single income.

Captain Chaos wrote:

With the new rules I'm going to need about a 50% deposit. It's going to take a while.

Hard going isn't it, I know mortgages were always notoriously hard to get from whatever decade you go back to but the current situation actually feels impossible at the moment.

Hopefully the new government bring in new lending rules which help first time buyers

SarahMollie · 10-03-2016 11:36am

Glen_Quagmire wrote: »

Hopefully the new government bring in new lending rules which help first time buyers

Hopefully not. Increased lending without any movement on the supply side will only push up prices.

More construction is whats needed, then the rest will sort itself out.

Glen_Quagmire · 10-03-2016 12:50pm

quad_red wrote: »

What do you base this on?

There is already a huge incentive for house construction. Giving FTBs more money will just push prices up without affecting initial affordability because the people they're competing against will be similarly boosted.

Have we learned nothing?

Yeah that is a good point. However, with current lending rules for FTBs I just cannot see how FTBs on a single salary or two low income salaries can afford to buy a house in Dublin or the surrounding areas without having massive savings behind them which is near impossible for the regular person renting and living in Dublin.

I take your point that increasing lending amounts to FTBs will only boost FTBs in similar circumstances, but at least FTBs would have a chance to buy in Dublin without having to save up to 50% of the house value first.

Muff Richardson · 10-03-2016 12:55pm

Captain Chaos wrote: »

I'm in a similar situation, currently saving around €1,200 per month and looking to buy almost anywhere in Dublin on a single income.

With the new rules I'm going to need about a 50% deposit. It's going to take a while.

Although you may not move into your new home as soon as you'd like, if you do manage to get up to a 50% you will save yourself an absolute fortune in interest payments over the years. The banks hate these rules more than any borrower does.

I'm in the same boat, but I find these rules to be a blessing in disguise. As mentioned the above poster, supply is the issue. Only 11,000 dwellings to be built in 2016 nationwide which is less than half the required amount and less than a quarter of the required amount in Dublin.

There's an awful lot of further turbulence forecast in various industry and and we have these newly elected clowns at the moment playing mind games and stubborn petty tribal politics all to wax their own inflated egos and bank balances.

SarahMollie · 10-03-2016 1:05pm

Glen_Quagmire wrote: »

Yeah that is a good point. However, with current lending rules for FTBs I just cannot see how FTBs on a single salary or two low income salaries can afford to buy a house in Dublin or the surrounding areas without having massive savings behind them which is near impossible for the regular person renting and living in Dublin.

I take your point that increasing lending amounts to FTBs will only boost FTBs in similar circumstances, but at least FTBs would have a chance to buy in Dublin without having to save up to 50% of the house value first.

I know that this isnt popular but where did the notion that every person should be able to buy a home come from? Its just not the norm in other developed countries, yet in Ireland people have a preoccupation with home ownership.

Also, they don't have to save 50%. Its 10% up to €220k and 20% thereafter. Thats a far cry from 50%.

10-03-2016 1:29pm

I'm in two minds about the rules. For me as I want to buy my first house as a single applicant its the 3.5 times salary that will be the issue. Even going to 4.5 times salary would bring a lot more houses into my range and the increased repayments would be very managable.

On the other hand I can see that it would drive prices up if people could borrow more so its 6 of one half a dozen of the other really.

SarahMollie wrote: »

Also, they don't have to save 50%. Its 10% up to €220k and 20% thereafter. Thats a far cry from 50%.

I'd imagine he means with the 3.5 times salary limits he would not be able to borrow anywhere near enough to buy a house in Dublin so would need a 50% deposit so make up the shortfall.

Glen_Quagmire · 10-03-2016 1:43pm

Azalea Screeching Padding wrote: »

I'd imagine he means with the 3.5 times salary limits he would not be able to borrow anywhere near enough to buy a house in Dublin so would need a 50% deposit so make up the shortfall.

Thats precisely what I meant!

SarahMollie · 10-03-2016 2:09pm

Azalea Screeching Padding wrote: »

I'm in two minds about the rules. For me as I want to buy my first house as a single applicant its the 3.5 times salary that will be the issue. Even going to 4.5 times salary would bring a lot more houses into my range and the increased repayments would be very managable.

On the other hand I can see that it would drive prices up if people could borrow more so its 6 of one half a dozen of the other really.

I'd imagine he means with the 3.5 times salary limits he would not be able to borrow anywhere near enough to buy a house in Dublin so would need a 50% deposit so make up the shortfall.

But thats just it though really - if your earnings are so far off the actual prices, then maybe that means you can't afford what you want and need to adjust your expectations, ie apartment rather than house or cheaper area, or continue renting.

Increased access to credit isnt going to improve things for a person in this scenario, as every person like them will also have the same access to that credit and prices will only go up. That benefits the banks and property speculators only.

Glen_Quagmire · 10-03-2016 4:58pm

SarahMollie wrote: »

But thats just it though really - if your earnings are so far off the actual prices, then maybe that means you can't afford what you want and need to adjust your expectations, ie apartment rather than house or cheaper area, or continue renting.

Increased access to credit isnt going to improve things for a person in this scenario, as every person like them will also have the same access to that credit and prices will only go up. That benefits the banks and property speculators only.

Its not really - what salary you earn doesn't necessarily determine how much you can pay back each month on a mortgage. Of course the more you earn the more you have etc, however for example one person earning 60k a year may may have more outgoings each month than another person on 60k a year. The first person may struggle to put aside 800 a month for their mortgage while the second could comfortably put aside 1500.

Of course it'll improve things for a person, it will allow them purchase a better house in a nicer area

Tigerandahalf · 11-03-2016 10:01am

If young people are saving this much money each month it is easy to see why the economy is still struggling. Young people are normally great spenders for the pubs and retail. It is a catch 22 situation.
Are CPOs not used in order to bring development land on stream?
With wages stagnant and many young people in precarious employment the government is going to be building a lot of social housing going forward.

angeldelight · 11-03-2016 10:09am

New builds are so expensive too - there's actually a lot of development where we want to buy but the prices are astronomical

Tigerandahalf · 11-03-2016 10:21am

Flatzie_poo wrote: »

Banks lend from savings. The economy is far from struggling. What's your point?

What wages are stagnant? Are implying wages as a whole are? That's not the case.

The economy is far from struggling? Have you been outside Dublin?
The growth rate of 7.5% is nowhere near a realistic figure. The corporations are putting a huge amount of money through the books in Ireland that is greatly distorting the figures.

Certain salaries may have increased but the vast majority haven't and it is those people that need to be housed. Public sector salaries which account for 300,000 people have seen no increases since they were cut either.

Oil prices are very low saving people lots on commuting and heating costs. That may change going forward.

I cannot see how a vast amount of people can house themselves. A huge amount of social housing will still be required.

Santy2015 · 11-03-2016 11:26am

It's 24 days since we applied for our mortgage, got in contact with our advisor last Thursday week to ask why there's such a delay, he said there's a back log of submissions and that he should be sending it last Friday or early this week. I've grown seriously frustrated since Wednesday that no updates have been given, so I emailed him in the afternoon yesterday to see will he get back to me by this morning as we are viewing a house today to see what it's like, (we won't be putting any bids or saying anything to the EA) we viewed a show house a few weeks back and we loved it and are viewing an unfinished version today, now I'm guessing no news is good news when it comes to the estate agent not being in contact since we last viewed as she did say she's tell us if there was any interest. To sum up we really really want one of these houses ( only 4 left) and I feel the bank are just shoving us to one side because of our age (mid/late twenties) and circumstances (living at home and high savings 1320e a month) cam anybody shed any light on our situation?

SarahMollie · 11-03-2016 11:34am

Santy2015 wrote: »

It's 24 days since we applied for our mortgage, got in contact with our advisor last Thursday week to ask why there's such a delay, he said there's a back log of submissions and that he should be sending it last Friday or early this week. I've grown seriously frustrated since Wednesday that no updates have been given, so I emailed him in the afternoon yesterday to see will he get back to me by this morning as we are viewing a house today to see what it's like, (we won't be putting any bids or saying anything to the EA) we viewed a show house a few weeks back and we loved it and are viewing an unfinished version today, now I'm guessing no news is good news when it comes to the estate agent not being in contact since we last viewed as she did say she's tell us if there was any interest. To sum up we really really want one of these houses ( only 4 left) and I feel the bank are just shoving us to one side because of our age (mid/late twenties) and circumstances (living at home and high savings 1320e a month) cam anybody shed any light on our situation?

Get a broker, go to another bank, shop around.

Don't put all your eggs in one basket.

Flatzie_poo · 11-03-2016 11:37am

Sleepy wrote: »

Those two applicants would have *VERY* different savings records and current account statements. It'd be very clear to any underwriter that the latter applicant was a safer bet for a mortgage from the most cursory examination of their current accounts.

Safer bet. Yes. But if both are approved up to the max of the multiplier, then the current account's activity are meaningless. They're judged off the multiplier, not disposable income. Say one has 2k left over, after mortgage repayment, while the other has 1.3k. It makes no difference with net salary. (I'm assuming no exemptions granted to the CB rules here.)

Sleepy wrote: »

I'm not sure I see how. The savvy will be able to apply as normal, the less savvy will get advice from a mortgage broker.

Mortgage advisors won't give investment advice. They'll tell them it exists, but they won't show them how. 2 Tiers. Anyway, my point is that net is just as bad as gross.

Your point on childcare has too many variables and is personal in it's design to you - so I can't comment. But other childcare options exist. Thankfully we can leave them with grandparents whist working.

Sleepy wrote: »

So for simplicity sake, lets assume I earn a gross salary of 100k per year (I can only wish, but it's a nice round figure for the sake of argument). That 100k per year would be the equivalent of another married couple with two kids but both working, earning a combined 124k or so.

Yes, there's an argument that two salaries coming in means that a couple are less likely to default in the case of one losing their job but when judging solely on affordability, the nuclear family earning 100k where one parent stays at home are able to afford a higher mortgage repayment than the dual income family earning 100k and having to pay childcare etc.

You argued in your opening point to me about a "safer bet," well, the wheel comes full circle.

PhoenixParker · 11-03-2016 12:04pm

Flatzie_poo wrote: »

Safer bet. Yes. But if both are approved up to the max of the multiplier, then the current account's activity are meaningless. They're judged off the multiplier, not disposable income. Say one has 2k left over, after mortgage repayment, while the other has 1.3k. It makes no difference with net salary. (I'm assuming no exemptions granted to the CB rules here.)

This isn't true though. The multipliers are one criteria, they're not automatic qualification for the maximum loan amount. You're not just judged off the multiplier.

The banks also look at disposable income and spendings/savings patterns over multiple months. Outside of the multipliers they look at your actual ability to repay. If you can't show that you're regularly setting aside the amount of the mortgage payment with a bit to spare, then you won't get the loan even if you meet the multipliers.

athtrasna · 12-03-2016 3:36pm

Mod Warning

Re-opening cleaned up thread with the following reminders:

The thread is about saving for a mortgage, not how mortgages are calculated

Posters are asked to remain civil, attack the post not the poster and report not retort

Posters are asked to Stay On Topic!

The thread has a very valid basis and will help not just the OP but other future homeowners who are hoping to be able to save for a mortgage. Please remember this when posting.

There will be no more warnings, this thread has turned into a time sink for the forum mods. Cards will follow if the thread derails again like it has done this week. Thanks for your help.

Athtrasna

Jet Black · 12-03-2016 5:09pm

I'm FTB, single applicant with around 150k. Started looking in Dublin last summer for a place with my limited budget. I was looking in Finglas because it was one of the few areas I could afford, I grew up there and know the good/bad areas.

I was ringing estate agents asking about places under 150k to arrange a viewing, 'Oh the current bid is at 180k' was the reply to many of them. Some were 70k over the asking by the time I called. So I went to open viewings, they were packed and had a lot of interest. People in the same situation as me and were just buying what they could with their limited budget. I was outbid on every property I viewed and the bidding went well past the houses value. The last place I viewed I really liked the location. Friends and family lived on the road and it was quiet. Again it was packed, at least 10 people looking at it. I set my price and started bidding. Estate agent said 5 others bidding on it... Great I thought. I was outbid again after a few weeks and gave up on it. There was nothing else in the area I liked so stopped looking and said I'd start again in January.

January came and nothing had really changed. I was about to start looking further out when the estate agent called and offered me the last house I viewed. I was delighted, been stressful the last two months but I'm going to the solicitors to sign next week and then all I have to do it wait until I get the keys. Good luck to everyone here, especially single applicants, I know the stress..

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

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