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Will we get a mortgage?

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  • 29-07-2010 2:33pm
    #1
    sky.boy
    Registered Users Posts: 47 ✭


    Me and my wife are going to apply for a mortgage soon.This is our situation. We've been saving for about 4 years and we have recently bought a site with our savings. The site has full planning permission and we have all our fee's paid i.e solicitor, county council fee's, stamp duty etc etc.My wife is starting a full time job in september. We will earn about 3200 a month when her job starts. We will be looking to borrow 220000 max and the finished house will be worth about 400000. We dont have any loans or credit card debt. We dont have any savings left after paying for everything. Will the banks use the site as a deposit. What do you think our chances are of getting the mortgage


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    #2
    Kimia
    Registered Users Posts: 2,897 ✭✭✭Kimia


    How do you know the house will be worth 400,000?


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    #3
    Head The Wall
    Registered Users Posts: 2,892 ✭✭✭Head The Wall


    sky.boy wrote: »
    Me and my wife are going to apply for a mortgage soon.This is our situation. We've been saving for about 4 years and we have recently bought a site with our savings. The site has full planning permission and we have all our fee's paid i.e solicitor, county council fee's, stamp duty etc etc.My wife is starting a full time job in september. We will earn about 3200 a month when her job starts. We will be looking to borrow 220000 max and the finished house will be worth about 400000. We dont have any loans or credit card debt. We dont have any savings left after paying for everything. Will the banks use the site as a deposit. What do you think our chances are of getting the mortgage

    You should really have checked all this out with the banks before hand. I approached them with a similar scenario recently and they didn't seem very helpful. We have enough to Buy and get a bare shell and roof up and would have been looking for a mortgage at that stage. They couldn't really commit to anything at this stage as they don't know how the market will play out etc.

    I know they would probably have preferred that we keep a lot more savings and they would give us a bigger mortgage (better for them). You can only try them and see at this stage


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    #4
    [Deleted User]
    Posts: 23,339 ✭✭✭✭ [Deleted User]


    sky.boy wrote: »
    We will earn about 3200 a month when her job starts. We will be looking to borrow 220000 max


    3200 gross or take home ?
    Take home maybe, gross not a chance I would think.


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    #5
    shoegirl
    Registered Users Posts: 2,021 ✭✭✭shoegirl


    sky.boy wrote: »
    My wife is starting a full time job in september.

    Most banks and BS require you to be in a job for 3 years BEFORE applying, so they may not take her income into account. If you are 3 years in a job or working successfully for yourself, and have a clean credit record, and sufficient to borrow the amount on your own income, you'll qualify.

    However if you require the wifes new job in order to qualify, I think you might have a problem on your hands. It seems to have gone back to the old system of 2.5 times the main breadwinner plus 1 times the second earner.


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    #6
    sky.boy
    Registered Users Posts: 47 ✭sky.boy


    The 3200 is take home. Had a valuer look at the plans for a valuation. Thats where i got the 400000 valuation from. If it was worth 300000 the ltv is still fairly good


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    #7
    sky.boy
    Registered Users Posts: 47 ✭sky.boy


    shoegirl wrote: »
    Most banks and BS require you to be in a job for 3 years BEFORE applying, so they may not take her income into account. If you are 3 years in a job or working successfully for yourself, and have a clean credit record, and sufficient to borrow the amount on your own income, you'll qualify.

    However if you require the wifes new job in order to qualify, I think you might have a problem on your hands. It seems to have gone back to the old system of 2.5 times the main breadwinner plus 1 times the second earner.

    I thought you had to be 6 months in full time employment and then you could apply then.


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    #8
    who what when
    Registered Users Posts: 820 ✭✭✭who what when


    sky.boy wrote: »
    I thought you had to be 6 months in full time employment and then you could apply then.


    And i thought it was 2 years!


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    #9
    sky.boy
    Registered Users Posts: 47 ✭sky.boy


    My wife's parents would be willing to co-sign our mortgage. Would that make much diffirence to our application


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    #10
    Head The Wall
    Registered Users Posts: 2,892 ✭✭✭Head The Wall


    Six months is what they told me as well or until probation is over, Co-signing depends on what the mortgage provider wants. It's best to go and start asking around all the providers, get their requirements, current rates, find out their stance on site as security.

    Take it all from there


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    #11
    Theboinkmaster
    Registered Users Posts: 3,994 ✭✭✭Theboinkmaster


    sky.boy wrote: »
    My wife's parents would be willing to co-sign our mortgage. Would that make much diffirence to our application

    if you need your wife's parents to co-sign then you shouldn't be getting a mortgage for that high a value anyway


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    #12
    sky.boy
    Registered Users Posts: 47 ✭sky.boy


    It's not that we need them to co-sign the mortgage becuase we cant afford it. It's to make sure that we get it. We know what we can afford unlike some people back in the boom days taking out 110% mortgages to buy some half built semi detatched house


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    #13
    sky.boy
    Registered Users Posts: 47 ✭sky.boy


    Head The Wall wrote: »
    Six months is what they told me as well or until probation is over, Co-signing depends on what the mortgage provider wants. It's best to go and start asking around all the providers, get their requirements, current rates, find out their stance on site as security.

    Take it all from there

    Thanks for your help. Will start asking around


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    #14
    ted1
    Registered Users Posts: 23,514 ✭✭✭✭ted1


    if its a self build you'll find it hard. They would be reluctant on the basis that you may make a balls of the build and be left with a load of worthless bricks.


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    #15
    [Deleted User]
    Posts: 23,339 ✭✭✭✭ [Deleted User]


    sky.boy wrote: »
    It's not that we need them to co-sign the mortgage becuase we cant afford it. It's to make sure that we get it. We know what we can afford unlike some people back in the boom days taking out 110% mortgages to buy some half built semi detatched house

    ye have 3200 a month to play with, 220 000 over 30 years will be at least a grand a month, another 50 or so for life insurance. Leaves ye with €2150 a month to live on, pay all bills, food, run a car or two etc etc. Many banks would look at those figures and say ye can't afford it. Add in the self build if that's the way ye are going and there is less chance. Do ye have savings for the furniture and whatnot, where are ye living in the interim while the house is being built ? How secure is the Mrs's job that she is starting etc etc.

    A couple pulling in €3200/month after tax is not tempting for a bank, if one of ye lose the job ye are screwed.


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    #16
    ZYX
    Registered Users Posts: 882 ✭✭✭ZYX


    RoverJames wrote: »
    A couple pulling in €3200/month after tax is not tempting for a bank, if one of ye lose the job ye are screwed.

    I am afraid RoverJames is right. €3200 a month means about €21,000 each a year before tax. You are looking for a mortgage more than 5 times your combined income, with no savings, one of you just starting working, on a self build.


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    #17
    Head The Wall
    Registered Users Posts: 2,892 ✭✭✭Head The Wall


    This is why they make you get a registered engineer to sign off on it structurally.


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    #18
    Theboinkmaster
    Registered Users Posts: 3,994 ✭✭✭Theboinkmaster


    sky.boy wrote: »
    It's not that we need them to co-sign the mortgage becuase we cant afford it. It's to make sure that we get it. We know what we can afford unlike some people back in the boom days taking out 110% mortgages to buy some half built semi detatched house

    You need them to co-sign because you cannot afford this mortgage. The numbers don't add up - you're trying to borrow too much relative to your monthly income.

    You obviously don't know what you can afford as the loan you're talking about is far too large. you're monthly repayments are too high a % of your monthly income and as interest rates rise they will too. If i was a bank i wouldn't give you that mortgage.


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    #19
    sky.boy
    Registered Users Posts: 47 ✭sky.boy


    good job your not our bank manager then. ah well, we still have another 4 years on the planning permission so whats the panic. It will get built some day


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    #20
    shoegirl
    Registered Users Posts: 2,021 ✭✭✭shoegirl


    Doing the math here. If your wife is starting a full time job and both are working, assuming she is only getting the minimum wage, it means you're only getting about 25k pa? This gives a combined income of about 41k.

    I think the old fashioned system of 2.5 times the first wage plus the second in this case wouldnt give you a grand total potential mortgage of just under 80k.
    220k is nearly 3 times that figure, something isn't adding up.

    If we have all got you wrong and you are currently on 85k pa and the wife will be on the minimum wage, then bobs your uncle and there is a chance you're ok. However your monthly take home would be nearly 6000 a month, not 3200? It doesn't add up?

    Keep saving though and you can probably cut the cost of your build and wait your incomes have risen. Wouldn't see any realism in your plans based on the information given so far.


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