Amount to borrow?

heretosay

I'm thinking of getting a mortgage. I just wanted to get peoples opinions on the amount I'm looking to borrow and where I am at the moment. I'm a very nervous person and worry I should potentially borrow less as while the amount I'm looking for seems manageable to me at the moment I'd be worried what could happen.

Single 28 next month No Kids
Basic Salary 44000 Bonus 3000

Current savings 22000: saving 1k per month for last 6 months. Also paying Rent €180 per month. deposit to be taken from savings: 16k Remainder to be used for stamp duty and other costs / safety net.

6 years in current job. Started as a graduate on mid 20k salary and worked my way up. Currently very secure and promised a pay rise (to min 50k) in next pay review as workload and responsibilities have increased significantly recently.

Max I want to spend on a House: 155k (I'm hoping to get one cheaper).

Taking away the deposit then that would mean the Max Loan amount I would request would be 139k borrowing over 30 years but repaying earlier if I can.

Based on this repayments would be roughly €721.35 per month if I go 3 years fixed initially. This would be approx 29% of my monthly nett pay. (approx 2,500 nett per month currently)

Does this seem reasonable?

killers1

heretosay wrote: »

I'm thinking of getting a mortgage. I just wanted to get peoples opinions on the amount I'm looking to borrow and where I am at the moment. I'm a very nervous person and worry I should potentially borrow less as while the amount I'm looking for seems manageable to me at the moment I'd be worried what could happen.

Single 28 next month No Kids
Basic Salary 44000 Bonus 3000

Current savings 22000: saving 1k per month for last 6 months. Also paying Rent €180 per month. deposit to be taken from savings: 16k Remainder to be used for stamp duty and other costs / safety net.

6 years in current job. Started as a graduate on mid 20k salary and worked my way up. Currently very secure and promised a pay rise (to min 50k) in next pay review as workload and responsibilities have increased significantly recently.

Max I want to spend on a House: 155k (I'm hoping to get one cheaper).

Taking away the deposit then that would mean the Max Loan amount I would request would be 139k borrowing over 30 years but repaying earlier if I can.

Based on this repayments would be roughly €721.35 per month if I go 3 years fixed initially. This would be approx 29% of my monthly nett pay. (approx 2,500 nett per month currently).

Does this seem reasonable?

You are looking to borrow around 60% of your borrowing capability based on the banks income calculators. This is not excessive at all, it's quite conservative. Your repayments are €721pm and you are soon to have a net monthly salary increase of circa €250pm. You are also currently used to paying out €1,190pm to savings & rent. Once your salary increases it's the equivalent of servicing a mortgage of €471pm on your current salary (€721 less €250 increase). Do you think this is manageable?? You are currently paying out €1190 to savings & rent which equates to a mortgage of €139k at circa 10% interest rates which gives you lots of wiggle room. The very fact that you are worried about the figures and are being conservative would lead me to believe you'll have no difficulty in taking on that commitment. In a worst case scenario down the road you could look for a housemate, sell or rent so you have options. If you're ready to buy a property now then go for it, as the figures stack up and are well within your capacity. If not, then keep saving and buy when you have a more substantial deposit to put towards the transaction. Best of luck!

D3PO

thats a pretty high percentage of your salary when you consider, life assurance, house insurance, property tax aswell as any other unexpected costs.

its certainly very managable based on the figures you post though , and banks will stress test heavily these days.

I dont think you need worry though. You should be fine on the above