Single wage couple - Mortgage

shelby67

Hi all,

I am in a bit of a pickle. We are a newly married couple with no children and are looking to try get on the property ladder. We had no real savings but my mother has given us 20K but a friend said the banks will want to see that we can save instead of just being given money.

I plan on saving money from this 20k each month and then from my own wages I will save money somewhere where the banks wont se it.

Would you recommend the credit union?

Also I have a 16k loan from th credit union will the banks be able to see this or do I keep my mouth shut about it?

I totally understand that I am being dishonest but at this stage I just want a property to live in with my wife and will have no problems paying a mortgage back which will be around 900 per month

The_Morrigan

shelby67 wrote: »

Hi all,

I am in a bit of a pickle. We are a newly married couple with no children and are looking to try get on the property ladder. We had no real savings but my mother has given us 20K but a friend said the banks will want to see that we can save instead of just being given money.

I plan on saving money from this 20k each month and then from my own wages I will save money somewhere where the banks wont se it.

Would you recommend the credit union?

Also I have a 16k loan from th credit union will the banks be able to see this or do I keep my mouth shut about it?

I totally understand that I am being dishonest but at this stage I just want a property to live in with my wife and will have no problems paying a mortgage back which will be around 900 per month

Why are you trying to hide savings?

shelby67

Because I was told that lets say I have 2500 after I pay bills and I save 3500 the banks would rather see me saving money rather than see a family member giving money.

Again I was told the banks don't like thi because they feel it doesn't prove that I can save?

beveragelady

You want them to see you saving. They prefer to see a direct debit, rather than a few quid when you have it to spare. Hiding it away makes no sense.
Also, you are much better off disclosing the loan. You must be paying it off anyway, so they'll see the regular outgoing and ask about it.

corner of hells

shelby67 wrote: »

Hi all,

I am in a bit of a pickle. We are a newly married couple with no children and are looking to try get on the property ladder. We had no real savings but my mother has given us 20K but a friend said the banks will want to see that we can save instead of just being given money.

I plan on saving money from this 20k each month and then from my own wages I will save money somewhere where the banks wont se it.

Would you recommend the credit union?

Also I have a 16k loan from th credit union will the banks be able to see this or do I keep my mouth shut about it?

I totally understand that I am being dishonest but at this stage I just want a property to live in with my wife and will have no problems paying a mortgage back which will be around 900 per month

Why not go to a bank and go speak to someone about a mortgage application.

The_Morrigan

shelby67 wrote: »

Because I was told that lets say I have 2500 after I pay bills and I save 3500 the banks would rather see me saving money rather than see a family member giving money.

Again I was told the banks don't like thi because they feel it doesn't prove that I can save?

That doesn't answer my question.

Why are you putting money away from your wages so that the banks won't see it?

Tbh a gift is fine, but you need to have a history of financial competence so proof that you can meet all your obligations...rent, bills, loans etc all go a long way.

Galwayguy35

A single wage person needs to be on about 35 k a year these days for the banks to even look at them, I got away with getting a mortgage earning a lot less back in 08 but it's different now.

irelandrover

Why not pay off the loan with the money from your mother?

shelby67

beveragelady wrote: »

You want them to see you saving. They prefer to see a direct debit, rather than a few quid when you have it to spare. Hiding it away makes no sense.
Also, you are much better off disclosing the loan. You must be paying it off anyway, so they'll see the regular outgoing and ask about it.

Rather than save over 2 years I am trying to get to 20k in savings so I can apply for a mortgage of 180k, I am using some of the gift money to survive the month rather than save a lower amount.

If they ee the CU loan will that not put them off loaning money to me?

shelby67

irelandrover wrote: »

Why not pay off the loan with the money from your mother?

I thought about this but that will leave me with no help on saving for the mortgage, granted I will have the 275 per month from the CU loan.

I understand what I am trying to do is not the normal way but we are newly married and having serious problems living with her fathers family and I need to try get a property asap

No Pants

I await the thread from the OP in < 5 years where he's complaining about the reckless bastards banks.

beveragelady

shelby67 wrote: »

Rather than save over 2 years I am trying to get to 20k in savings so I can apply for a mortgage of 180k, I am using some of the gift money to survive the month rather than save a lower amount.

If they ee the CU loan will that not put them off loaning money to me?

It looks like you're just playing with numbers, moving the money from place to place pointlessly. The mortgage liason wants to see that you have a history of sustained regular saving. Concealing loans and savings is not going to help. Even if you have a loan, they'll see that you've been paying it back, and they'll be impressed. If you haven't been paying it back you're probably not in a position to apply for a mortgage.
I have a permanent state job, a gift of over €25000, a history of regular saving and loan repayments, and as a single income applicant I have been refused €185,000.
You need to go into any bank other than your own and talk to a mortgage advisor as if you were applying for a mortgage. Tell them everything, keep no secrets. You'll get solid facts and advice there, and you always go elsewhere to sort out an actual application.

shelby67

No Pants wrote: »

I await the thread from the OP in < 5 years where he's complaining about the reckless bastards banks.

That's a great help thanks. I wouldn't expect someone who writes a comment like that to understand problems we are having living with a family member, but thanks for showing me that there' always one person living on boards just to write snotty comments.

_Kaiser_

shelby67 wrote: »

I thought about this but that will leave me with no help on saving for the mortgage, granted I will have the 275 per month from the CU loan.

I understand what I am trying to do is not the normal way but we are newly married and having serious problems living with her fathers family and I need to try get a property asap

Sounds like you might be better renting for a while to be honest and sorting out your savings/loans arrangements in that time. As your friend said, banks will want to see a regular banking record of manageable outgoings and savings first.

As an aside..

I have to admit, seeing the phrase "get on the property ladder" returning, coupled with a lot of posts like this one in the last few months is really a worrying trend. A mini-bubble in SCD does not a Celtic Tiger make.

There's another 2bn to come out of the budget this year and Water Charges from January. Where are people getting this idea that the "good times" are back??

shelby67

beveragelady wrote: »

It looks like you're just playing with numbers, moving the money from place to place pointlessly. The mortgage liason wants to see that you have a history of sustained regular saving. Concealing loans and savings is not going to help. Even if you have a loan, they'll see that you've been paying it back, and they'll be impressed. If you haven't been paying it back you're probably not in a position to apply for a mortgage.
I have a permanent state job, a gift of over €25000, a history of regular saving and loan repayments, and as a single income applicant I have been refused €185,000.
You need to go into any bank other than your own and talk to a mortgage advisor as if you were applying for a mortgage. Tell them everything, keep no secrets. You'll get solid facts and advice there, and you always go elsewhere to sort out an actual application.

I have been paying the CU every month and never missed a payment.

Brilliant advice I will make an appointment with a bank that I not mine and spill my guts and see how it goes, thank you o much for the advice

beveragelady

shelby67 wrote: »

I thought about this but that will leave me with no help on saving for the mortgage, granted I will have the 275 per month from the CU loan.

I understand what I am trying to do is not the normal way but we are newly married and having serious problems living with her fathers family and I need to try get a property asap

It looks like renting is your solution. If you can show that you've been paying rent regularly that'll count in your favour when you're applying for a mortgage. If you can't afford the rent, then you wouldn't be able to pay back a mortgage either.
Sorry, I know this sounds harsh, but this is the reality.

shelby67

beveragelady wrote: »

It looks like renting is your solution. If you can show that you've been paying rent regularly that'll count in your favour when you're applying for a mortgage. If you can't afford the rent, then you wouldn't be able to pay back a mortgage either.
Sorry, I know this sounds harsh, but this is the reality.

thanks to you an Kaiser, I can afford the rent so maybe I will go this route after I tlk to the bank thi week.

_Kaiser_

shelby67 wrote: »

That's a great help thanks. I wouldn't expect someone who writes a comment like that to understand problems we are having living with a family member, but thanks for showing me that there' always one person living on boards just to write snotty comments.

To be fair, problems living with family are not a reason to start looking at buying property "by any means necessary" either. That sort of thinking is how we ended up where we are now in the first place.

shelby67

would anyone advise speaking to a mortgage broker first?

MagicMarker

shelby67 wrote: »

I understand what I am trying to do is not the normal way but we are newly married and having serious problems living with her fathers family and I need to try get a property asap

If only there was another option between buying and living with family. Hmmm.

_Kaiser_

shelby67 wrote: »

would anyone advise speaking to a mortgage broker first?

It can't hurt, just as speaking to the banks is a good idea - if only so you'll know what they'll expect of you if you are to get this mortgage.. bear in mind though that it's also in their interest to sell you a mortgage, so get a trusted opinion too.

In the short term though, I think renting is the way to go. Gets you out of the family situation (also important for other reasons as newlyweds ) and you can start building the banking record you'll need anyway.

Captain Chaos

beveragelady wrote: »

It looks like renting is your solution. If you can show that you've been paying rent regularly that'll count in your favour when you're applying for a mortgage. If you can't afford the rent, then you wouldn't be able to pay back a mortgage either.
Sorry, I know this sounds harsh, but this is the reality.

In Dublin that is not always the case, right now in Dublin rent is costing me a good bit more than if I was paying back a mortgage. It's currently cheaper for me to buy right now and I would have more cash left over per month, crazy but that's the way it is.

_Kaiser_

Captain Chaos wrote: »

In Dublin that is not always the case, right now in Dublin rent is costing a good bit more than if I was paying back a mortgage. It's currently cheaper for me to buy right now and I would have more cash left over per month, crazy but that's the way it is.

That was always the case in the "good times" too though - renting is dead money / sure a mortgage would be cheaper etc

This may be true in a day-to-day short term situation, but as we've seen if done unsustainably it can lead to disaster

MarkR

Banks will want statements and wage slips and p60s. You'll have to sign off on a statement showing your financial status. They do this so people don't play with the numbers, risking them getting in over their heads.

shelby67

MarkR wrote: »

Banks will want statements and wage slips and p60s. You'll have to sign off on a statement showing your financial status. They do this so people don't play with the numbers, risking them getting in over their heads.

The gift is just a gift it is not going to pay my mortgage back, I have the money to pay back a mortgage so I am not worried about that. After all bills are paid I am left with approx. 2000-2500 per month so based on 200k a mortgage will be around say 950 permonth

I can provide the bank with proof of everything, I am not making up wht I earn or what I pay out I am just wondering what way to go about it.

No Pants

shelby67 wrote: »

That's a great help thanks. I wouldn't expect someone who writes a comment like that to understand problems we are having living with a family member, but thanks for showing me that there' always one person living on boards just to write snotty comments.

It must be tough being the only person in Ireland with a family and therefore uniquely placed to understand the situation. The bank certainly doesn't care about anything beyond whether you can and will make mortgage repayments. Right now you look like someone who could, until something better to spend your money on was found.

tony1980

I don't have alot of savings myself but have 5+ years record of paying rent of 800 euro per month. I am permanent and earn just above what a single applicant should at least be earning, my wife doesn't work. We are been gifted the deposit from my mother, the bank just pre-approved us for up to 127K, I was advised that I should try to show savings of about 5k myself outside of the gifted deposit as it would look alot better. The bank said there would be no problem with the deposit been gifted as we have shown the re-capacity to re-pay a mortgage with the rent we have been paying, even after the stress test, we were below what we are paying in rent which we do with no difficulty so I am very hopeful we should be ok. It's not a huge mortgage we are looking for and the re-payments even with insurances will be much less than our rent.

I would advise renting for a year, trying to live some bit frugally, save as much as possible and keep your accounts looking good. Paying off your loans will look good for you so don't try hide that, it will work in your favour. Renting will help show you have the capacity to re-pay the mortgage and your bills and to also save.

KindOfIrish

corner of hells wrote: »

Why not go to a bank and go speak to someone about a mortgage application.

All decisions in banks taken by computers nowadays. You can talk there as much as you like, but if you don't follow correct algorithm, computer will say "NO". And staff in a bank will never teach you how to play a computer. Mortgage broker possibly will.

tony1980

The underwriter has to approve it I thought.

okiss

In your case I would do the following

1) You need to work out a budget in regards to rent, bills ect to establish what you can live on and what you can save when your renting.
If you look up the www.consumerhelp.ie you can get a lot of information and under tools and calculators there is a budget plan.
When you rent a place get the bills in your name and in your wife name also. Get on the register of electors at your new address.
Rent a cheap as place as possible.

2) In regards to the €20k you have been give I would put €5000 of this towards the credit union loan and the remaining €15k in to a high interest instant access savings account.

3) Once you do this you will owe the credit union €11000. You need to pay this off as soon as possible. I would look at paying this off in the next 12 to 18 months.
If this is a car loan would you consider selling the car and buying a cheaper car as this would give you some more savings.

4) Also on www.consumerhelp.ie under your money you can see the best regular savings accounts. Open one of these accounts and set up a standing order to have x amount go to this account each month.
Once you have the credit union loan paid off you can save more money into this account.

5) You have told us that your wife is not working at the moment. She needs to get a job. The banks will take into consideration the fact that you are the only person working, along with your income and outgoings.
I would also advise you that if you have a child before applying for a mortgage they will take this into consideration also.

6) Be prepared to budget as much as possible. Shop in Aldi/Lidi. Bring a lunch into work as this could save you a lot of money.
ie spend €5 a day = €35 a week x 48 weeks a year = €1680 a year

The banks will want to see regular saving each month and no unpaid direct debits or standing orders or any type of internet gambling.

At the moment you need to get your debits paid off and show a regular savings pattern before applying for a mortgage.
Before you apply for a mortgage you need to get a copy of both your credit histories with www.icb.ie. This cost €6 each at the moment.
If any information on this is wrong you need to contact the bank/credit union and get them to put a note on your credit report to say a mistake was made by them not you.

I hope the above helps you out.

Millem

okiss wrote: »

In your case I would do the following

1) You need to work out a budget in regards to rent, bills ect to establish what you can live on and what you can save when your renting.
If you look up the www.consumerhelp.ie you can get a lot of information and under tools and calculators there is a budget plan.
When you rent a place get the bills in your name and in your wife name also. Get on the register of electors at your new address.
Rent a cheap as place as possible.

2) In regards to the €20k you have been give I would put €5000 of this towards the credit union loan and the remaining €15k in to a high interest instant access savings account.

3) Once you do this you will owe the credit union €11000. You need to pay this off as soon as possible. I would look at paying this off in the next 12 to 18 months.
If this is a car loan would you consider selling the car and buying a cheaper car as this would give you some more savings.

4) Also on www.consumerhelp.ie under your money you can see the best regular savings accounts. Open one of these accounts and set up a standing order to have x amount go to this account each month.
Once you have the credit union loan paid off you can save more money into this account.

5) You have told us that your wife is not working at the moment. She needs to get a job. The banks will take into consideration the fact that you are the only person working, along with your income and outgoings.
I would also advise you that if you have a child before applying for a mortgage they will take this into consideration also.

6) Be prepared to budget as much as possible. Shop in Aldi/Lidi. Bring a lunch into work as this could save you a lot of money.
ie spend €5 a day = €35 a week x 48 weeks a year = €1680 a year

The banks will want to see regular saving each month and no unpaid direct debits or standing orders or any type of internet gambling.

At the moment you need to get your debits paid off and show a regular savings pattern before applying for a mortgage.
Before you apply for a mortgage you need to get a copy of both your credit histories with www.icb.ie. This cost €6 each at the moment.
If any information on this is wrong you need to contact the bank/credit union and get them to put a note on your credit report to say a mistake was made by them not you.

I hope the above helps you out.

Getting a copy of your icb report is a great idea, there was a mistake on one of ours which has thankfully been rectified! The bank will know about your credit union loan if they are on icb (which I bet they are!). Last year I was told :
You need to show your own savings too in addition to the gift, whatever the mortgage is they stress test to 2% higher than current interest rate and you need to have €1250 left over or €2000 for a couple after stress test and any loans/direct debits, if you have any dependents they deduct €250 and child benefit is not counted as income. I would go to a broker whatever you tell them is confidential and they will put your case forward in the best possible light.