New mortgage rules will they change for 2016 and going forward??

Michael D Not Higgins

REFLINE1 wrote: »

i understand that but the post i quoted stated "even if you have half the deposit..", i read that to mean, even if you have half saved ...

No he said 50% deposit, i.e. half of the value of the house was gifted to you and you didn't save anything.

Black_Knight

REFLINE1 wrote: »

i understand that but the post i quoted stated "even if you have half the deposit..", i read that to mean, even if you have half saved ...

Its all a measure of how well the buyer can manage funds. Better to have saved half the deposit yourself than 100% from parents. But also better to have saved 100% yourself rather than 50% yourself. Banks look for these kinda things. Mortgages are 25-35 year long commitments, its obvious banks would like to see commitment to savings rather than a few years savings + a top up.

worded

worded wrote: »

I heard that's banks no longer accept a € gift from family being part of a deposit. They used to but that has changed

Of course the bank will accept gifted deposits, a lot of the people who can afford to buy at the moment are doing so because their parents want to help them get started out in life and are gifting them money to help with buying.

Now I can see the bank refusing a gifted deposit if its the full 10% and you have no savings record but if you are saving and have less than 10% and the rest is a gift I'd imagine it wouldn't be a problem and even more so if you say have 10% saved your self and you get a gift of another 20 or 30% say. This makes the mortgage much less risky for the bank as its smaller so they aren't going to have an issue with it.

REFLINE1

Michael D Not Higgins wrote: »

No he said 50% deposit, i.e. half of the value of the house was gifted to you and you didn't save anything.

you're correct, reading comprehension fail on my part- carry on

SarahMollie

Bryan Victorious Zirconium wrote: »

Of course the bank will accept gifted deposits, a lot of the people who can afford to buy at the moment are doing so because their parents want to help them get started out in life and are gifting them money to help with buying.

Now I can see the bank refusing a gifted deposit if its the full 10% and you have no savings record but if you are saving and have less than 10% and the rest is a gift I'd imagine it wouldn't be a problem and even more so if you say have 10% saved your self and you get a gift of another 20 or 30% say. This makes the mortgage much less risky for the bank as its smaller so they aren't going to have an issue with it.

TBH, I'm not sure when this came in. I bought in 2015 (sale agreed June, completed in October, think I applied around March). I had an inheritance which I used for my deposit. Not exactly the same as a gift, but obviously doesn't tell them anything about my ability to save or otherwise.

This was never questioned by BOI, however I do bank with them normally, so I suppose they knew I did have other savings also.

Ultimately I went over my budget (inheritance+mortgage amount) by €19k so i paid that myself out of my savings, so I did end up putting some of my cash into equity in my home, however this wasnt part of the plan when I approached the bank at first.

SarahMollie

SarahMollie wrote: »

TBH, I'm not sure when this came in.

I'm not sure that it ever came in, I think its mostly hearsay.

slowjoe17

TheDoc wrote: »

I've given up on saving to ensure that we as a family can enjoy life. We wouldn't be big spenders. We both arn't consistent or big drinkers, and you could probably count on one hand the amount of times we go out a year for a meal or a drink. Our interests and hobbies are relatively low cost, and I've knocked most things on the head the last few years like Airsoft, Golf and some other things I'd do recreationally that contained a cost.

So your rent has consumed all disposable income...

I'm not in mortgage distress, or owe someone money. so while I need to save, I've very little left a month to do so, and we just decided that for now we won't bother. We are talking €100-€200 a month capabilities for savings here if even. I have mentioned to the O/H that my next two bonus' I'll try squirrel away savings that won't be touched(hopefully) That will go a long way.

But as anyone knows, life can throw **** up at you. Previous savings I did have, got chipped away with unforseen situations. Car repairs, incurance hikes, hospital visits, GP visits, Dental work etc. etc. So when you have little disposable income, those variables are a massive hit. So any savings there, can sometimes be required in emergencies.

It sounds like you have no cushion to protect against "events". What happens if the landlord of your home decides to move? What happens if you have a car accident? I'd be concerned.

Also, you speak about an upward curve of salary. Which payrise will start the saving off? One painless way to increase savings rate is to save the entirety of your post-tax annual pay-rise. But for this to work, you have to start saving.

These central bank rules come with both yin and yang. The yin is that it's a pain to scrape a deposit together. The yang is that they have stopped the 20% pa rises we were seeing in 2014. This is an opportunity (for as long as the central bank can hold the line) to pick up a house for 20-40% less than the alternative future where the bank doesn't make the rules.