Chances of getting mortgage?

Maximus_1

Hi there,

Myself and my wife are wondering about our chances with the banks for folks with our circumstances. We are 32/34 and have a 6 month old son. Renting at present in the west for €500/month. I work full-time in a place for the past 5 years earning 30k, my wifes job pays 28k and she is due back to work the end of January.

Our sons grandparents who are still fairly young in thank God in good health have happily volunteered to mind him whilst his mum is back to work, i understand we are very lucky in this regard. However I am wondering about the possibility of her going back to work 3 days a week instead of 5. Her employer is quite flexible and I think that would be an option with them. Now to my main query...

If she did go back on reduced hours and reduced her salary accordingly our total gross would come down to circa 48k. We have 25k in savings and looking at houses around the locality 150k so a mortgage around the 120k mark. I'd like my wife to have more time at home with our son (as would she) and I am just wondering if a bank would laugh us out the door on those numbers and whether if we want to own our home we need both of us working full-time.

Thoughts and experience welcome, thank you.

D3PO

First things first you need to get your wife's working situation nailed down. 3 day 5 day and the income coming in will obviously be a contributing factor.

After that all you can do is go to the bank and see how they feel about the application.

You have a decent deposit, but then again we dont know all the details about your outgoings so cant really tell you based on the limited detail you have provided. Having a child will impact you in terms of how the banks look at the affordability of a mortgage for you.

Bear in mind historically low interest rates that will be on the rise, property tax, you will need to have life assurance as a prerequisite of drawing down your mortgage and your monthly outgoings will be significantly higher.

25 year €120,000 mortgage with AIB will cost you currently €649 a month with variable rates touted to go up circa another .5% this year which if it happens would cost you approx another €72 a month in payments.

so you could all things considered be looking at outgoings of up to €300 a month more to own a property (forgot to mention the loss of your rent relief tax credits aswell)

thats as things stand, you then should be stress testing for further interest increases. Is this defiantly affordable to you ? Only you know your budget and outgoings. Until you supply all this detail to the bank so they can make an assesment you wont know

Maximus_1

Thanks for getting involved D3PO. I appreciate theres more detail required of course and I only looking for some general feedback. Our out-goings arent big, car loans are paid off so neither of us have that monthly cost. We pay health insurance, €140/month, €55 between TV and broadband. Car tax/insurance €260/month. groceries hard to say really

Whilst my wife was on maternity benefit (262/week) we managed to save €400 each month on top of the rent so hoping the bank will look favourably on that, we live quite modestly.

Suppose what I'm really wondering is if my wife chooses to go back 3 days will it blow our chances of getting a mortgage as I hear/read many stories of 2 people working full-time getting turned down.

killers1

Maximus_1 wrote: »

Hi there,

Myself and my wife are wondering about our chances with the banks for folks with our circumstances. We are 32/34 and have a 6 month old son. Renting at present in the west for €500/month. I work full-time in a place for the past 5 years earning 30k, my wifes job pays 28k and she is due back to work the end of January.

Our sons grandparents who are still fairly young in thank God in good health have happily volunteered to mind him whilst his mum is back to work, i understand we are very lucky in this regard. However I am wondering about the possibility of her going back to work 3 days a week instead of 5. Her employer is quite flexible and I think that would be an option with them. Now to my main query...

If she did go back on reduced hours and reduced her salary accordingly our total gross would come down to circa 48k. We have 25k in savings and looking at houses around the locality 150k so a mortgage around the 120k mark. I'd like my wife to have more time at home with our son (as would she) and I am just wondering if a bank would laugh us out the door on those numbers and whether if we want to own our home we need both of us working full-time.

Thoughts and experience welcome, thank you.

The reduced combined salary of €48k is still more than sufficient to qualify to borrow €120k. If your rent + monthly savings amount to over €800 per month and have consistently done so for at least 6 months you have a very good chance of gaining approval at that level even with your wife working 3 days per week.

fricatus

killers1 wrote: »

The reduced combined salary of €48k is still more than sufficient to qualify to borrow €120k. If your rent + monthly savings amount to over €800 per month and have consistently done so for at least 6 months you have a very good chance of gaining approval at that level even with your wife working 3 days per week.

I'd second that... banks are definitely beginning to lend again. If you're living modestly, have little debt and a steady income, they should look favourably upon you.

Your baby will probably just be treated as a €200-250 monthly outgoing. We were given outline approval for a mortgage in June but the arrival of the little fella in the meantime didn't impact too seriously on the amount we were finally approved for in November.

There is no way to know of course other than to apply to a few banks (or indeed just go to a broker). While you're thinking about it though, start collecting every P60, bank statement, payslip, credit card bill, savings account statement etc. that you receive, and keep it in a single location.

The biggest pain in the a55 when we initially applied was that we had to ring our banks and credit unions to get all this stuff, and it was just a major hassle. If you have six months' worth of documentation when you go into the bank, you'll have a much easier time.

D3PO

Maximus_1 wrote: »

Thanks for getting involved D3PO. I appreciate theres more detail required of course and I only looking for some general feedback. Our out-goings arent big, car loans are paid off so neither of us have that monthly cost. We pay health insurance, €140/month, €55 between TV and broadband. Car tax/insurance €260/month. groceries hard to say really

Whilst my wife was on maternity benefit (262/week) we managed to save €400 each month on top of the rent so hoping the bank will look favourably on that, we live quite modestly.

Suppose what I'm really wondering is if my wife chooses to go back 3 days will it blow our chances of getting a mortgage as I hear/read many stories of 2 people working full-time getting turned down.

From what you have posted it seems to me your a very good candidate for approval for the amount your looking for.

I wish you and your new family every success. Go to the bank and apply and let us all know how you get on.

Good luck

Maximus_1

Thanks to all for the replies, most helpful and much appreciated. Will get collecting those statements! Fingers crossed we are successful and I will come back to this thread and update it in due course, maybe useful for others in a similar boat, thanks again