Up to 80k mortgage for a couple?

MagicMarker

What kind of place are you going to get for 80k? I only ask because you said you want to start a family and I wouldn't have thought you'd get somewhere big enough for 80k.

OMD

Balmed Out wrote: »

Didnt know that, couple of questions if you dont mind.

Any idea of how much easier?, always assumed bank would make more money of you so would be more likely to extend it.

Very easy to shorten the term, just pay extra and your term is shortened. No permission as such is needed. Extending term is more difficult. It may require a new mortgage to be taken out.

Balmed Out wrote: »

What about insurance costs? How much more for a 25 vs 20 yr mortgage?
You hear a lot of people going on interest only payments. Surely if this is to continue to be a norm if you get in trouble then the shorter term loan would be a massive advantage?

Insurance costs will be higher but unless you are single, you really should have life insurance anyway, irrespective of whether you have a mortgage or not. I am not saying you cannot have a shorter mortgage. My point is it is better to have a 30 year mortgage and repay it over 20 years than have a 20 year mortgage which you repay over 20 years. If you have a 30 year mortgage which you are repaying over 20 it gives you leeway if times get tough. You can simply revert to a 30 year mortgage without asking anyone. You can even use the extra payments you have made on your mortgage to stop future payments for a period of time if times are really tough.

ShadowHearth

MagicMarker wrote: »

What kind of place are you going to get for 80k? I only ask because you said you want to start a family and I wouldn't have thought you'd get somewhere big enough for 80k.

In cork area you can find nice terrens houses, apartments or semi detached house. For us 2-3 bedroom place is more then enough. Plus I am not looking for fancy new house, i better get something small and do some of the work myself.

Was good questioned mentioned here: is interest same on 20 and 30 year mortgages? I always thought: longer you take - more interest you pay?

Balmed Out

The longer the term the more you pay but theres nothing to stop you paying more each month then you need to was the point.
ie. you can take a 30 year mortgage but pay x extra each month to pay back in 20 years. You are reducing the principle all the time and end up paying the same amount back as if you took a 20 year mortgage. Not sure if theres a premium charged if you go ahead and do that.

http://www.loanclc.com/
handy site to compare loans and stress test against interest rate rises.

Mr. Loverman

Balmed Out wrote: »

The longer the term the more you pay but theres nothing to stop you paying more each month then you need to was the point.

I know it's longer in the long term, but do the monthly payments have less interest, e.g. do the bank use some weird way to calculate interest based on the length of term?

JuliusCaesar

This is a good mortgage calculator. It shows the amount of interest vs the amount of capital repayments (the amount borrowed). You can move the payments up and down and see what happens. The calculator will work out "weird ways" that the banks use.

The more you can repay, the quicker you pay off the mortgage, the less interest you pay. I asked my bank and they said I can make occasional extra payments or increase my regular monthly payment - either way or both I end up paying my mortgage off earlier and not paying as much interest.

ShadowHearth

Update: finally got sorted with some paperwork.

Went to bank yesterday, the person we were dealing was busy( I was delighted) so we got anather person, who I have dealer before when taking small loans. She was 100% brilliant, I got all answers I needed, calculation of mortgage we are looking for, not the 140k which we don't need... Good few tips. Alltogether she was exelent, I even asked her to look after our case from now on, as I was very unconfident with previuos person.

So we gave: p60, 3 months payslips, salary certificates. Finished off the forms too. Now we are playing the waiting game.

Allready finder out: we will need life insurances, but we don't need health insurances. House insurance. We were afraid that bank wont take us seriously because of small sum we apply for, but she said that's even better these days, they tend to make deals with smaller sums and more people, then 1 big one now.


So all in all it looks allright so far. Hopefully soon I will be able to post here with a big smile on my face. I'll keep you posted. Hopefully such thread will help someone else too!

tanyabond

What bank are you dealing with?

ShadowHearth

tanyabond wrote: »

What bank are you dealing with?

Aib

variety

ShadowHearth wrote: »

She said that we will have to pay something to auctioneers for property too? I thought auctioneers deal with property owner aka seller? Our problem is just to pay the asking price... I am a bit confused here.

I would assume she meant the valuation fee, which is usually €130 and has to be paid to the auctioneer upfront.

With AIB, they don't require this before loan offer stage, but they are the only lender not to require it then.

So, once you get your loan offer (fingers crossed you do, if this is really what you want!), then they will get an auctioneer who is on their "Valuers Panel" to value the property for them, and you will have to pay that auctioneer €130.

ShadowHearth

Update:

Got a phone call today from aib. I got 3 months to find the property for 80k!

I am happy as pig in ... You know ... .

I screamed like a little girl in the middle of kitchen when she said it's approved. Lads looked at me like I was some weirdo .

It's only the beginning, but now I cam start looking at properties.

Cheers again lads! Really really thanks for all help I received here! I presume this thread might help some ather newby . Will still keep you posted if anyone will be interested.

smelltheglove

Best of luck Shadow, never saw this thread and like reading through it esp how you both like living here. Wish you all the best and keep us updated as you go along!