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Mortgage

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  • 04-02-2008 4:46pm
    #1
    Youghal
    Closed Accounts Posts: 8 ✭


    Hi,

    I have a question.

    I got a personal loan for 6K in Dec. 2007 and also a HPI for 15K in Jan. 2008. both over a periode of 5 years.

    I have savings and dealings with my bank, now I want to apply for a 100% mortgage, earning around 52K gross a year. here is all my questions.


    How longs does a decision take on a mortgage application ?

    What is a bank looking at when someone apply for a mortgage?

    With my earning and debt is it realictis getting a mortgage for 230K over 30 years?

    Look forward to some advice since a mortgage is a big commitment.

    Cheers


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    #2
    LouOB
    Closed Accounts Posts: 1,181 ✭✭✭LouOB


    If you were buying with someone else your application would look much better tbh

    App takes about a week - less if you know person
    Bank looking at your disposable income, at first - I would go into them. Much more personal face to face.
    Your personal debt will be taken into account - to what extend - dunno.

    Best advice - make appointment, bring in all statements and P60 etc. Talk to rep in a branch.


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    #3
    dotsman
    Registered Users Posts: 3,636 ✭✭✭dotsman


    Youghal wrote: »
    How longs does a decision take on a mortgage application ?
    If you make an appointment to see your relationship manager or lender, you should get a "Mortgage in Principle" straight up (basically a letter saying that they would consider giving you a mortgage for X amount). This allows you to bid on a property with some confidence that the bank will give you a mortgage to purchase.

    The letter of offer will be given to you within a few days of providing details of the actual property, solicitor, evidence of earnings etc.
    Youghal wrote: »
    What is a bank looking at when someone apply for a mortgage?

    What are they looking at? In short, everything!
    Earnings, job security, future earnings (can you realistically expect large salary increases in the near future - ie if you are a trainee account/solicitor/doctor etc), credit history, financial history (how good you have been in the past with regards savings etc), current assets (do you have any savings/investments that you could fall back on if times got hard), current liabilities (your outstanding debt is going to be a killer here), relationship with the bank (how long you have been a customer, any family members who are high value customers etc), price of property, location of property, ability and desire on your behalf to "rent-a-room" etc. Different banks will put different emphasis on these points, but any lender worth their salt will take everything into consideration.
    Youghal wrote: »
    With my earning and debt is it realictis getting a mortgage for 230K over 30 years?

    Your existing loans will work against you very much as they affect your DSR.

    Let's say your take home pay is 3K. A bank might have a policy of 40% DSR = 1,200 - That's the max they will let you use to service your debt. Let's say your monthly repayments on your outstanding loan is 500, that leaves only 700 for your monthly mortgage repayment. You're not going to get much a mortgage if that's the monthly repayment. (to service 230K over 30 years, your looking at 1250 per month approx.

    Can I ask what the loan & HP were for? If you're seriously considering purchasing a property, you should be saving money, not blowing money that you don't even have:eek: (first question a prudent lender would ask!)

    Certainly, make an appointment with your bank, even if it's just to get a feel of what needs to be done before you can get your desired mortgage. Oh, and I wouldn't try to hide the current debt. They would very likely find out and pretty much throw you out of the office if you hadn't already told them!


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    #4
    Youghal
    Closed Accounts Posts: 8 ✭Youghal


    Hi Dotsman.

    Many thanks for your reply, I really appreciate it.

    Let me explain a bit more in detail.
    My recent debt I have came from a HPI ( Hire Purchase Agreement ), basically its a car loan. I needed a car going to and from work, bought a SEAT 2008, the car was 21K but I put down my deposit of 6K so my borrowing was 15K.

    I do have savings with the bank, I save monthly, and also when I check my current account daily I would transfer money into my savings account, so Im a good saver without having saved a million euro ;)

    I have booked an appointment with the bank next week since I have already found my house I would like to buy, so I am going to tell I have 2 loans ( Car loan and personal loan ) and the rest of my savings and current account they can access themselves since Im only banking with them.

    I have 2 jobs, one full time giving me around 3300Euro a month the second one gives me around 1200Euro a month total 4500Euro a month after tax. The 2 loans coast me 469 a month.

    I have my current account, savings, loans, credit-card, and long term investment with the bank, been with them for 4 month and always "behaved" well. I dont have family doing banking with themselves, but know the manager and a few people in there.

    Do you think it looks completely nonsense based on the figures... :confused:

    Thanks


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