mortgage question

Lainey

hope this is the right forum for this..

just wondering does anyone know how many times your annual income can you get for a mortgage.. single person..

jd

Lainey wrote:

hope this is the right forum for this..

just wondering does anyone know how many times your annual income can you get for a mortgage.. single person..

Using the ebs calculator
30000 -120000
40000- 160000
50000- 195000
60000- 226000

That's without saying you'll take on a lodger.

Saying you'll have a lodger (for about 500 a month)
30000- 120000
40000- 160000
50000- 200000
60000- 240000

No loans outstanding, childcare etc

KdjaCL

60,000 240,000

Average house price of 250,000 in Dublin, what premiership football team do you play for ?
Used to be the income of the main earner x2.5 now they see easy money giving out loans to peole who cant afford to pay it back.


kdjac

jd

KdjaC wrote:

60,000 240,000

Average house price of 250,000 in Dublin, what premiership football team do you play for ?

what me :?

Used to be the income of the main earner x2.5 now they see easy money giving out loans to peole who cant afford to pay it back.
kdjac

yeah- it looks like about 4x gross, though I think they try and keep repayments to a max of 40% of takehome.
Those people will have fun when rates rise Q2 05.

spongebob

civil servants get about 5x , I know one who did so recently .

jesus_thats_gre

Gardai in particular have an easy time in getting mortages..

I actually have my own question.. If one intended on purchasing a 4 bedroom house with the intention of renting out the 3 spare bedrooms for a total of 200 a week. 200 a week equates to just over 10,000 a year. As far as I know, 7,000 (a little bit more anyway) is see a non-taxable income and the remaining 3,000 will be seen as taxable income. If one was on say 40,000 a year, could you put down 50,000 (40,000 salary and 10,000 rental income) as your total expected earnings?

I have been told by a budding lawyer that I can but I just want to make sure.

EddieTheEagle

Hi Lainey,

The days of going on x3 or x4 of salary are gone to a large extent. Banks these days tend to work on the basis of percentage of take home salary. A general rule of thumb is that they don't want your mortgage repayments being over 35% of your take home salary. So with a little bit of playing on a mortage calculator e.g. http://www.jeacle.ie/mortgage/ you can have a general idea as to how much they would give you. Of course this assumes no other debts e.g. car loan etc but they will add a bit on for renting rooms. The amount that banks gives differs between them with AIB being conservative and Ulster Bank generally willing to lend larger amounts as they try to build market share.

re: query of Jesus_thats_great: The bank will take into account the fact that you are renting rooms if you indicate this but you cannot put this onyour mortage application as expected income. This is because it is not guaranteed income and for the purposes of guaranteeing that they will be paid it is only guaranteed income they are interested in (with irregular income and bonuses taken into consideration to some degree as well).

Also be aware that the rent a room limit is 7,620 per year. If you receive more than this you will be liable for tax on the FULL amount (i.e. not just the amount above 7,620)

More info on these topics can be found at www.askaboutmoney.com

Hope this helps,
Eddie

irlirishkev

Something else to note -

If you can work out what you can afford to pay back every month, and it comes to more than that 'standard' multiple of your salary, you can have someone financially stable act as a guarantor. That's what I've done. If it went by a true multiple of my (somewhat pathetic) salary, then I'd be screwed..

Kevin.

De Rebel

jesus_thats_gre wrote:

Gardai in particular have an easy time in getting mortages..

I actually have my own question.. If one intended on purchasing a 4 bedroom house with the intention of renting out the 3 spare bedrooms for a total of 200 a week. 200 a week equates to just over 10,000 a year. As far as I know, 7,000 (a little bit more anyway) is see a non-taxable income and the remaining 3,000 will be seen as taxable income. If one was on say 40,000 a year, could you put down 50,000 (40,000 salary and 10,000 rental income) as your total expected earnings?

I have been told by a budding lawyer that I can but I just want to make sure.

I'd check that out if I was you. I remember reading that rent received for letting a room is allowable only up to the limit (€7620), if the rent exceeds the limit the entire amount (and not the balance over the limit) is taxable. The figure is not just rent per say, but any other money that changes hands for food, electricity, gas etc etc is included.

I'm not certain on this, and am open to correction.

Victor

irlirishkev wrote:

If you can work out what you can afford to pay back every month, and it comes to more than that 'standard' multiple of your salary, you can have someone financially stable act as a guarantor.

The guarantor will of course also have to be able to pay. No use in the guarantor having a €500,000 house and no income to pay from.

grumpytrousers

I have been told by a budding lawyer that I can but I just want to make sure

Hmm....You might do better to find a budding accountant...