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A few first time buyer questions

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  • 08-03-2009 2:28pm
    #1
    shamblertine
    Closed Accounts Posts: 888 ✭✭✭


    What do I do first- go to the bank and try and get a mortgage for a certain amount?
    Or do I find a place I want to buy first and then try and get a mortgage?

    If I go with the first option and get a mortgage first, for say 250k then it turns out I only need 200k do I have to completely reapply for a 200k mortgage or does common sense prevail and the bank simply modifies my original mortgage application?

    Also how long does it usually take for banks to approve a mortgage? Was thinking of aiming to get a mortgage and buy an apartment by July, would this by possible or does the whole process take far longer? And what are all the steps I have to go through by the way in purchasing a place?

    Any help is much appreciated.


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    #2
    MonkeyTennis
    Registered Users Posts: 3,098 ✭✭✭MonkeyTennis


    it doesnt matter really which way you do it, but its good to have an idea of how much you want to borrow.They can do some of the preliminarry work. Once you find the property you want to buy they can do the rest. Shop around for a good solicitor too


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    #3
    Freddie59
    Closed Accounts Posts: 6,679 ✭✭✭Freddie59


    Don't buy anything this year. You'll save thousands. Check these sites:

    www.thepropertypin.com

    www.treesdontgrowtothesky.com

    www.irishpropertywatch.com

    www.irishhometruths.com

    YOU WON'T REGRET VIEWING THEM.:)


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    #4
    JuliusCaesar
    Registered Users Posts: 4,882 ✭✭✭JuliusCaesar


    shamblertine wrote: »
    What do I do first- go to the bank and try and get a mortgage for a certain amount?
    Or do I find a place I want to buy first and then try and get a mortgage?

    Find out how much they are williing to lend you. This in addition to your own savings, calculations re Stamp Duty, solicitors fees etc, will give you a price range for looking at houses.
    shamblertine wrote: »
    If I go with the first option and get a mortgage first, for say 250k then it turns out I only need 200k do I have to completely reapply for a 200k mortgage or does common sense prevail and the bank simply modifies my original mortgage application?

    No problems adjusting your borrowing downwards at all.
    shamblertine wrote: »
    Also how long does it usually take for banks to approve a mortgage?

    Usually takes about 7-10 days to get an answer from the banks & building societies.
    shamblertine wrote: »
    And what are all the steps I have to go through by the way in purchasing a place?

    Any help is much appreciated.

    Call into a few banks and building societies. They'll give you an info pack with all the info you need to gather - P60s, pay slips, evidence of savings, etc etc. Gathering all the info is a complete pain and can take a while. Then go to each bank with your info, they'll photocopy it and give you your answer within a week or so or will require further info. I'd advice going to every bank & building society as their offers can sometimes diverge wildly.

    Ask around about getting a solicitor. The legal costs can be pricey - maybe 7K. Educate yourself about mortgages, interest rates, savings, Stamp Duty, Tax Relief at Source (TRS), and everything else you need to know. Check out this forum, daft.ie, askaboutmoney.com and all the other sites mentioned above. Only you can make up your own mind, and it's probably the biggest purchase you'll ever make, so get to know as much as possible yourself. It's your hard-earned money!!

    Then go look at houses - the fun part. Go and look at a LOT of houses, even ones you've no intention of buying. The more you go to see, the more you'll learn about questions you must ask. It'll also give you a feel for the market and how to negotiate prices with estate agents. (BTW, remember estate agents are NOT your friend and lie through their teeth - and it's legal for them to do so.)

    It's all very time comsuming and most mortgage offers stand for 6 months. After that they'll need updates on your info.

    Be prepared for the amount of time the whole process will take up.

    Edit: don't forget you can't buy a house without having 1. mortgage protection insurance (in case you die, the bank will be paid off) and 2. household (home and contents) insurance (to pay for floods, burglaries, fire etc) Add the costs of these onto your mortgage amount to ensure you can keep up the payments.


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    #5
    dan_d
    Closed Accounts Posts: 2,819 ✭✭✭dan_d


    Agree with everything JuliusCeasar said, but I've one thing to add. Don't tell the estate agent what you can afford or how much you've got approval for, even if they ask (which they've no right to do, although I don't think it's illegal). It's none of their business, and you're entitled to look at whatever houses you like, regardless of what they think you might be able to afford (some can be a touch intimidating!!)


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    #6
    bills
    Registered Users Posts: 952 ✭✭✭bills


    We got approval in a few days once we had all the necessary documents. You definetely need approval before looking imo as no point looking at houses you cant afford/wont get a mortgage for. Our mortgage approval only lasted 3 months so beware of that. Also, legal costs are about 2k. E-mail/ring around and you will get quotes. You also get a feel that way for how quickly they e-mail you back etc.


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    #7
    JuliusCaesar
    Registered Users Posts: 4,882 ✭✭✭JuliusCaesar


    dan_d wrote: »
    Don't tell the estate agent what you can afford or how much you've got approval for, even if they ask

    Of course the EA wants to know....so they can get you to shell out your max! Which may be the best price for the seller - who they are working for. The estate agent is NEVER your friend - the EA is there to get the best price for the seller.

    Always offer lower than you think the house is worth - your bid might be accepted!

    So +1 to dan's advice.


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    #8
    Senna
    Registered Users Posts: 8,800 ✭✭✭Senna


    bills wrote: »
    Our mortgage approval only lasted 3 months so beware of that.

    At the moment most banks will only give approval in principle until you actually find the house you want, the days of 3/6 month mortgage approval is gone. Means that they may be willing to give you 200k today, but if it takes you two months to find somewhere, that 200k could be a lot less.

    Best advice is to go to the bank and get a figure that they would be willing to lend you, then look at houses priced around (under) that level and try and get a good discount.

    EDIT; just reread your post. Best advice would be to continue renting, it would be complete madness to buy an apartment now or anytime soon. If you really want to buy, buy a house that is in some way suitable, not an apartment that you will grow out of and wont be able to sell as no-one wants the fecking things.


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    #9
    shamblertine
    Closed Accounts Posts: 888 ✭✭✭shamblertine


    forgot to thank everyone for all the advice, much appreciated


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