What are your options if you want to buy and don't have the deposit?

mathie

Fighting Irish wrote: »

and people on here blame the government, banks and the builders?

Well the main culprit is the financial regulator.
They're meant to protect Joe Public from taking out large mortgages with non-existant deposits.
If during the boom years the regulator had done his job then people wouldn't have been able to get mortgages of ten times their salaries with Credit Union loans.

The financial regulator are the parents in this situation.
The babies may want to put their hands in the fire but the parents should have the fire guard up.

Paddy McGinty

quozl wrote: »

And rentToBuy is a great big scam for suckers. That was theoretical, but obvious, when it first came out, but there's a years worth of price-falls, and suckers paying over the market rate rents to prove it now.

Quozl, I'm interested in your opinion of rent to buy.. as far as I understand it, each case will stand (or fall) depending on it's own terms? As the option (not obligation) to purchase extends to a timeframe that's pre-agreed between both parties, then what happens during that timeframe (e.g. a moving market) will ultimately be the deciding factor for the tenant/buyer as to whether they proceed with the option to buy, or not.

If things move in the T/B's favour then they go ahead, if not, they dont. True, for those that don't there will usually be a financial loss, but it's usually the flexibility they're buying in the first place (which you don't get should you jump in and take out a mortgage from day1 - i.e. you're locked in and thats it).

If only "a years worth" of price falls makes the process unworkable then it sounds like either the option period is set too short, or else credits towards any deposit were excessive.

A bad deal doesn't naturally make a process a scam for all. A bad deal more often than not arises from someone not asking "what if...?" at the outset.

I concede my only experience with lease-option arrangements is in England but I suspect the model will be identical in Ireland.

Only my second post on 'boards' so not wishing to ruffle anyones feathers, but would love to see the figures for a typical arrangement - particularly if it smells of scam! (pm me if you like).

EDIT - Since posting the above I've just trawled this forum reading R2B stuff..mmmh, yes it's similar to what I've seen but it only seems to revolve around new build? The key (as far as I'm concerned) is the potential buyer should be able to apply the R2B principle to ANY property on the open market (providing seller agrees of course). After all, it is (slightly) more a buyers market than a sellers one, so there has to be give and take from both sides. The worst thing that should happen to tenant/buyer is they hand back the keys and lose a few bob (normally less than they would have spent just plain renting). The worst thing that should happen to seller is the agreed price is lower than market value at the time option to buy is exercised. The big problem with doing this kind of arrangement with new-build is they are much more difficult to accurately value as there are seldom any like for like comparables to base such a valuation on.

With an older property, more often than not direct comparables do exist, therefore you (should) have the chance to go head to head with the seller and negotiate more favourable terms. A two-year term (examples I seen on here) is frankly a complete waste of time. Not a scam.. but not a very good deal either. Apologies for jumping in to the thread.. I'll get me coat. ;O)

Cheers.. Pat (up the spaniards)

ei.sdraob

gurramok wrote: »

And you know what, that deposit I have saved can also be a rainy day fund if life turns upside down as none of us know what is around the corner(loss of job, illness);)

your not saving with an irish bank are you?

you wouldnt want to wake up one day and find your bank is "out of funds"

Blackjack

mathie wrote: »

If during the boom years the regulator had done his job then people wouldn't have been able to get mortgages of ten times their salaries with Credit Union loans.

If people had been financially prudent enough, they would not have gotten these mortgages. If I bought a Car, and it turns out to be a Lemon, is that the Governments fault now?

At what point do you want the Nanny state to begin taking responsibility for preventing or allowing all your actions?.

While I agree that the Regulator did not do their Job, people need to start taking responsibility for their own actions, and not looking to blame others when they make an inappropriate decision.

bugler

As unlikely as honest, competent regulation is, it is far more likely than the average person in Ireland developing some sense of responsibility or financial literacy/numeracy.

The latter, while being ideal, just isn't attainable.