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Getting a mortgage, total noob :-)

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  • 03-06-2014 10:54am
    #1
    zweton
    Registered Users Posts: 2,683 ✭✭✭


    Hey,

    Myself and the missus have recently been talking about geting a mortgage ( not right now but 2/3 years time) need to save a bit more first.
    Whats the story with trying to get a mortgage these days? Is it a no no straight off, we are both working only one permanent at the moment.
    We are currently renting a house (675 p/m) so another year or two of this and i think we would have enough of renting. I do realise there are people out there struggling to get on the property ladder. Like how long does one need to be saving with particular bank before they would even consider you? Any info much appreciated:)

    Thanks


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    #2
    JoeySully
    Registered Users Posts: 1,276 ✭✭✭JoeySully


    You don't need to save with any particular bank to take out a mortgage with them, you just need to show over a period of at least 6 months that you can afford to pay a mortgage. This means proof of savings/rent and you need to show your expenditure too. Keep your Credit cards payed off and clear any loans you can. Make your banking simple! What I mean is have one account for daily banking and one shared savings account. If you have multiple bank accounts you will have to submit statements for all of them and will unnecessarily complicate the application.
    Unsubscribe from any online gambling or online lotto.
    Having children before you get a mortgage will reduce the amount you can borrow so wrap it up ;)


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    #3
    ShowMeTheCash
    Registered Users Posts: 2,651 ✭✭✭ShowMeTheCash


    I would not worry too much about keeping credit cards clear or what you spend you cash on, at the end of the day a credit card is there to be used, just as long as you pay it off.

    The advice zweton gave is sound.

    The bank looks to affordability.

    If you are paying rent for 675 and the rent on a mortgage you are asking for would work out at 675 a month then you already demonstrate you can afford the mortgage.

    Banks will stress test the mortgage repayment usually by a 2% hike in interest.

    A good thing to do is this: Pay rent by DD and try and have money going into a saving account by DD also.

    Example:

    Rent DD 675
    Savings DD 325

    You are effectively demonstraing you can afford 1000 a month.
    Do this for 6 months +


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    #4
    o1s1n
    Registered Users Posts: 34,953 ✭✭✭✭o1s1n
    Master of the Universe


    JoeySully wrote: »
    Having children before you get a mortgage will reduce the amount you can borrow so wrap it up ;)

    And then you have children and realize you cannot afford your mortgage? Not the best advice really...

    OP - you might have difficulties if only one of you is permanent. A friend of mine is in a similar scenario where they're a married couple, he works but she can only find temp work (secondary school teacher) - None of the banks will look at them.


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    #5
    cml387
    Registered Users Posts: 8,436 ✭✭✭cml387


    o1s1n wrote: »
    And then you have children and realize you cannot afford your mortgage? Not the best advice really...

    OP - you might have difficulties if only one of you is permanent. A friend of mine is in a similar scenario where they're a married couple, he works but she can only find temp work (secondary school teacher) - None of the banks will look at them.
    Surely we are not at the stage where a bank can demand that both people are working before they grant a mortgage. It surely depends on income, and if one income can support a mortgage, then that's fine.


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    #6
    CIARAN_BOYLE
    Registered Users Posts: 14,599 ✭✭✭✭CIARAN_BOYLE


    cml387 wrote: »
    Surely we are not at the stage where a bank can demand that both people are working before they grant a mortgage. It surely depends on income, and if one income can support a mortgage, then that's fine.

    Non permanent income, through temp jobs or contract work seems to be seen as worth 60 to 70% of permanent income to the bank from what I've heard.


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    #7
    o1s1n
    Registered Users Posts: 34,953 ✭✭✭✭o1s1n
    Master of the Universe


    cml387 wrote: »
    Surely we are not at the stage where a bank can demand that both people are working before they grant a mortgage. It surely depends on income, and if one income can support a mortgage, then that's fine.

    I did say that they 'might have difficulties' - I didn't say it was set in stone or that the bank will demand this in every case, not sure where you're getting that from.

    Obviously a single salary which pulls in a lot will not be turned away.

    I just know a couple (in fairly decent jobs, one of whom is not permanent) who are having huge difficulties mainly because of the lack of permanency in one of the applicant's roles. Make of that what you will.


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    #8
    cml387
    Registered Users Posts: 8,436 ✭✭✭cml387


    I suppose the point is that it is still a housing market out of whack, if two full time incomes are required to buy a house.

    It used to be the case that the mortgage would be stress tested to ensure that if one partner lost their job the mortgage could still be paid.

    Now it would seem from anectdotal evidence that two incomes are being depended upon for a mortgage. So then what happens if one partner looses a job, or wants to go part time for childcare?


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