what options have i?

darrenoneill33

From what i can see i'm fecked as regards getting any type of mortgage. 27 year old single earning about 22,000. i'd say i wouldn't get enough to buy a doghouse!!
Have i any options?
A joint application? Is it possible to get a parent or something to be part of the application and increase what you can get.
Just wondering have i anyway around things....

godtabh

darrenoneill33 wrote:

A joint application? Is it possible to get a parent or something to be part of the application and increase what you can get.

I've done that. Everything is in my name but inorder to boost the numbers my Dads earnings were taken into account

The_Conductor

Rather than your parents income being taken into account in your mortgage application- its quite common for a parent to act as guarantor on your mortgage- essentially underwriting your application and stating that they will make good a default if it should so happen (depending on circumstances this could potentially be enforced by the sale of the family home, so its not really a good idea and is something that your parents would need to think very carefully about).

In practice mortgage approvals under guarantee conditions, are considered for up to 8 times earnings (i.e. 175k in your case). This might (perhaps) bring you into contention for the affordable housing schemes?

johnp

darrenoneill33 wrote:

From what i can see i'm fecked as regards getting any type of mortgage. 27 year old single earning about 22,000. i'd say i wouldn't get enough to buy a doghouse!!
Have i any options?
A joint application? Is it possible to get a parent or something to be part of the application and increase what you can get.
Just wondering have i anyway around things....

Affordable housing?

The_Conductor

Affordable housing in detail

Moonbeam

Would you be able to afford a mortgage on those earnings?
Maybe a 2nd job to bring up income?

darrenoneill33

Well i should be able to afford it alright. I have no other expenses really and noboby else to worry about apart from myself. Also my earnings should increse a fair bit over the next 3/4 years

johnp

darrenoneill33 wrote:

Well i should be able to afford it alright. I have no other expenses really and noboby else to worry about apart from myself. Also my earnings should increse a fair bit over the next 3/4 years

Consider a 1 bed apt will cost 300k. Over 30 years that about €1400 a month.
You need to be earning about 70k to use the "33% of your salary" rule.

(These very rough figures, but should give an idea.)

Moonbeam

I don't think he would be in the category of affording somehting like that.

Darren - what county are you based in?

Affordable housing or social housing would your options,check out the lower level of income levels for affordable housing and shared owenership,being a single buyer you have little chance with social housing.

Your prob better off putting it off until you are earning higher wages or have a 2nd job

darrenoneill33

Im in Cork. There are new houses going for around 260,000 in some places around the county, as long as you don't mind being 30/40 miles from Cork city.

I reckon i could afford to pay 1,000 a month

In no major rush really its just something i've been giving thought to recently

With regard to the affordable housing i presume the choice is very limited and only a few locations available?

Moonbeam

http://www.oasis.gov.ie/housing/buying_a_house_or_flat/affordable_housing_scheme.html

you wouldnt get a mortgage on 22k pa but you could possibley get a nice house through that scheme and you would also qualify for mortage subsidy.

johnp

darrenoneill33 wrote:

Im in Cork. There are new houses going for around 260,000 in some places around the county, as long as you don't mind being 30/40 miles from Cork city.

I reckon i could afford to pay 1,000 a month

In no major rush really its just something i've been giving thought to recently

With regard to the affordable housing i presume the choice is very limited and only a few locations available?

You'd be surpised how about choice for affordable housing. I've read a little about it, and from recollection up to 20% of every development can be taken by the county council for affordable housing.

Here's the link to whats available from Cork County Council.
http://www.corkcoco.ie/co/web/Cork%20County%20Council/Departments/Divisional%20Services/Housing/Schemes%20%26%20Grants/Affordable%20Housing

But even so, you're gonna need bundles of cash.

Cantab.

Get a higher paying job? 22k a year's not a lot for a 27 year old. I know immigrant workers on building sites who are pulling in twice as much.

Ogie16

easier said than done but hopefully thats his plan by sounds of it

hmmm

darrenoneill33 wrote:

From what i can see i'm fecked as regards getting any type of mortgage. 27 year old single earning about 22,000. i'd say i wouldn't get enough to buy a doghouse!!

What's wrong with renting? You're only 27 - have you decided that you are going to settle down in a particular area forever?

If you buy now and house prices fall, you're stuck.

Moonbeam

and if he doesn't and they keep gonig up?

It is a what if situation.

you want to move elsewhere you sell it.

If you apply for your mortgage jointly with someone else who is already a homeowner you won't be a 1st time buyer.

darrenoneill33

could rent but would feel like i was making no ground

worksucks

I think you're doing the right thing looking for somewhere to buy I was in a similiar situation not to long ago and managed to buy. If you've no car, big loans a 1,000 a month should be managable. Also you'll get around 100-150 a month on mortgage tax relief from the government. You need to get yourself a good mortgage broker (they are easier to deal with than individual banks) who will tell you who would be the best person to guarantor your mortgage. Also if financially your going to be under pressure you could make your property interest only for a couple of months.

darrenoneill33

Yeah thats it basically, i just think if i can get the foot on the ladder in some shape or form it will be of benefit for me in the long term.

I have a car but its paid for so my expenses on that aren't huge

blue banana

If you are buying more than a 1 bed, under the rent a room scheme you could earn another €7,200 per annum in rent, tax free. Some banks (ask a broker) will take this income into account in calculating your income, boosting you to €29,200 pa.

Obviously it would depend on where you buy and if you are willing to share your house for a year or two.

Best of luck

Moonbeam

It doesn't quite work that way but they do allow a bit extra if you are renting out a room,also for work bonuses that are guranteed and overtime.
I had to get the person who was gonig to rent to sign a form stating that they were going to rent the room and that they were paying x amonut per month.

The_Conductor

Moonbeam wrote:

It doesn't quite work that way but they do allow a bit extra if you are renting out a room,also for work bonuses that are guranteed and overtime.
I had to get the person who was gonig to rent to sign a form stating that they were going to rent the room and that they were paying x amonut per month.

Most mortgage lenders (BOI, AIB, NIB) are not willing to count work bonuses, overtime or rent-a-room income towards reckonable income for the purpose of calculating mortgage applications. They will normally only rely on definitive income figures- consisting of a payscale (if a public servant) a P60 and a statement from a trusted source (personnel officer etc). Work bonuses are not guaranteed unfortunately- and overtime/rent-a-room income etc would be reliant on economic conditions etc.

On a seperate topic- it would be really nice if the cut-off (7,620) for the rent-a-room scheme was raised significantly in the budget.......

Moonbeam

ptsb,ebs do and pretty sure aib do too.

It is not counted in the same way as you salary but is taken in to account.

This is my experience anyway.

blue banana

Sorry, rent a room relief is €7620 not €7200. There is definetly at least one bank in this country that takes rental income from rent a room scheme into account, I just can't remember which one, I know from previous experience through a broker. (Maybe it's not official!) I would have been able to get a bigger mortgage from one bank than many others because of this.

Obviously, you still have to have the ability to repay into account, so location etc is important.

The_Conductor

Yes, you're right.
If you remember which institution was willing to count the rent-a-room scheme income do post it here- will be of interest to the OP.

Cheers,

Shane

shoegirl

darrenoneill33 wrote:

Well i should be able to afford it alright. I have no other expenses really and noboby else to worry about apart from myself. Also my earnings should increse a fair bit over the next 3/4 years

To be honest I'd say you're screwed. Can sympathise since I spent most of my working years on pretty poor wages and the only option in the end was to change job/company. I think you'd need to be on about 40k in Cork to afford anything half decent unless you want to live 40 miles out.

On the other hand, get saving. An ex colleague of mine moved to Cork from Paris in 2002. He was earning about the same as yourself. He changed company twice over the years, saved like mad, got married, had two kids, and now he's earning between 35k and 40k and has a wife and 2 kids and a small house in town. It can be done. I remember at one stage he was saving 400 a month. It doesn't sound like a lot, but it would put a bit of a dent in a deposit.

Affordable housing in Cork is a bit ridiculous since I've heard of people earning more than yourself being offered houses that there's no way they could afford, even at the discounted prices. Would suggest getting into a pattern of savings and waiting a few years. While it does sound attractive to panic buy now, you really are probably better off waiting until you can actually afford the mortgage than taking out a mortgage you cannot afford and ending up running into debt problems.

darrenoneill33

Im doing an interview this week with Bank of Ireland. If i got the job do ye think it would strengthen my position. Would they look after an employee who applied for a mortgage with them? it might help some bit hopefully would it

The_Conductor

It will strengthen your position somewhat- but will not effect the amount they are willing to lend you. As a Bank of Ireland employee you will automatically get a discounted mortgage rate, not available to most of the public (ECB +.8 depending on circumstances- for a FTB, its not a bad offer).

Shane