Mortgage for €100K Property

beezlebub

I am looking at a house for 100K and have 7K saved at the moment. I probably would not get a mortgage at present but i am trying to arrange my affairs to allow this is the future

I am a permanent private sector work with 10 years permanent employment.

My basic salary at the moment is 24,000 but with overtime (built in) and shift premium my basic take home is 2,400 per month. This overtime and premium has always been in my salary. Also i am getting additional overtime. Because of certain circumstances i should be grossing 40K this year.

My average P60 is maybe 35K

I am recently married and my first child will arrive in February 2013.

Based on my basic above AIB would say

Married with one child
Basic Salary 2,000 - 2000DNI(Two Adults) - 250(one child) = Unapproved

Single Person
Basic Salary 2000 - 1250 DNI (One Adult) = 750 for mortgage (approved???)

Considering i am saving 1,000 and rent 550 i would assume my repayment capacity would be 1,550 as proven with time above.

So is it as simple as above that i would simply be rejected because i am part of being a one income family?

Do all banks apply the same criteria as AIB?

To be honest i am certain i could service and 80K mortgage stress tested to 6% and still live a comfortable life. These criteria are mental since they are effectively barring one income earner families from mortgages unless the single income earner is a high earner/ public servant.

kennyb3

I think the question has to be asked, how if you are in full time employment for 10 years have you only got 7k saved? Thats the first thing the bank will think of.

Idbatterim

I think 92% is the maximum banks will give out!

kodoherty93

The best thing to do is call a mortgage broker how is used to dealing with the banks and will tell you how to get a mortgage becuase after all they want to sell you. Obviously dont notice a subprime lender.

Also you consider the following:
Dont gamble using a credit card, the banks dont to see a paddypower gamble charged to your card,
Dont take out money at 2 - 5 am as they see it unprofessional

Most importantly dont under any circumstances miss a credit card or any other loan repayment until you get the mortgage. I know someone who was rejected a mortgage for missing two credit card repayments. Simple as that as they had the proper loan to value and were both in secure public sector jobs

L1011

kodoherty93 wrote: »

Dont take out money at 2 - 5 am as they see it unprofessional

One advantage of applying to a bank that isn't your own and providing paper statements to them is that they don't (generally anyway? never seen one that does) print the time on them.

But definitely avoid bookies, repeat visits to an ATM on a Saturday/Sunday, using ATMs with pub names on them (my local one does that), etc, etc...

beezlebub

Thanks for all the replies...

Yep only 7K saved ... What can i say young and stupid in the past. In fact 250K has come and gone through my hands in past four years but hey its only money:D

Now I've got a serious head on me and want everything clean as a whistle.

In fact i have just heard that i have a rent to buy deal come through so i will go with that.

I should require 70k loan in three years and i will keep 40K in the bank should all work out well. Which is another question. Would the banks give a 70K mortgage and allow you to keep 30K in the bank?

Reason i ask is because i do not think any bank would be interested in a 30K mortgage?

Really just trying to plan ahead to see what i need to do now to have a perfect record 2-3 years from now.

Houses prices will continue to drop but i need my own place now.

So,

Saving 1K per month and rent of 550 per month for 2/3 years

Would a bank lend 70K.

Wife and 1 maybe 2 children?

AIB criteria 2000+500 = 2,500 before mortgage say no?

The_Conductor

beezlebub wrote: »

Yep only 7K saved ... What can i say young and stupid in the past. In fact 250K has come and gone through my hands in past four years but hey its only money:D

This one statement has alarm bells ringing for me..... You've spent over a quarter of a million in the past 4 years, have only 7k in the bank and are now looking at buying a 100k property......... There must be some earth shattering story behind all this- and this statement alone will have to be explained away to any prospective lender before they'd consider you for a mortgage. A quarter of a million is a lot of money!

Normal lending rules (these days- whats normal?) are-

Maximum mortage of 91%, subject to meeting criteria (lower lte ratios preferred)
Max loan 2.5 times primary salary + 1 time secondary salary
Salary is calculated as gross salary- but no overtime, shift premiums, bonuses or other payments other than core salary are counted.
Maximum mortgage repayments are calculated as percentage of your NET after tax income- typically a maximum of 30-35% of NET income (they will vary this depending on dependants/children etc).

Have a look around at other lenders- AIB aren't the only lender in the market- perhaps other lenders may interpret the situation differently.

Have a good plausible story to what the hell happened the quarter of a million you've blown over the past 4 years!!!!