Question - childcare costs & mortgage application

gemini_girl

Hello,
Just wondering what your thoughts are on this.
I have 2 small children & am a stay at home mum. My husband is out of work & we rent our house. We're planning that when husband gets job that hopefully we'll be able to buy our own house. Someone has said to me that we wouldn't get approved unless both of us are working. In my old line of work (childcare/crèche) I would earn 9 euro an hour & my childcare costs would be 10 euro an hour. So it would actually cost me more to go to work. In terms of applying for a mortgage I would presume it would be of no benefit for me to be working when the childcare costs would be more than what I would earn. We would be looking at applying for a mortgage of about 90k (house for apx 100k) & would have the 10% deposit plus other costs. We wouldn't be 1st time buyers as we already owned then sold our first house 10 years ago. Husbands line of work would pay apx 35k a year but obviously he needs to find an actual job first & be permanent etc but we are planning ahead & want to be prepared. Any ideas on the childcare?

D3PO

if your a stay at home mum then there would be no childcare costs considered. There would of course be child expenses taken into account regarding affordability.

Right now you are putting the cart before the horse though. Let your husband get a job, get passed his 6 months probation and know how much hes earning then worry about the house purchase

best of luck with it.

gemini_girl

D3PO wrote: »

if your a stay at home mum then there would be no childcare costs considered. There would of course be child expenses taken into account regarding affordability.

Right now you are putting the cart before the horse though. Let your husband get a job, get passed his 6 months probation and know how much hes earning then worry about the house purchase

best of luck with it.

Thanks, I know it seem like Im jumping ahead but once husband is working & when time is right for us to apply I'd be gutted if we were told we wouldn't be approved for a mortgage because both of us wouldn't be working

D3PO

I can absolutely say 100% you don't both need to be working. If its affordable its affordable.

P.S Make sure you have transferred your tax credits to your husband for when he gets a job if you haven't already done so.

sarkozy

And as soon as your husband is earning again, make sure to put some proportion of income into savings. Banks like to see this, too, as it give them comfort that you can keep up repayments and are prudent with household finances (tough on 35k, of course). And if you can manage that over the next 12 months, it'll help your loan-to-value ratio, which will make you look more attractive to banks.

One other important consideration is where you're looking to buy. There's upward pressure on prices in commuter belts. If this is where you're looking, you may end up compromising by buying a place with longer commute times, which can affect quality of life. If, on the other hand, you're more permanently rural-based, then you're in no rush as prices are still coming down outside the Dublin region and other cities.

gemini_girl

Thanks Sarkozy,
we are in a cork suburb so no major commuting for us thankfully (30 mins at most).
At the moment we pay 800 a month rent out of his jobseekers alone (372 a week) so we'll have no problem saving if he earns 35k :-)