Any way of borrowing more than three times my salary for a mortgage?

Rym Shanley

I've just had a brief call with a broker who didn't fill me with confidence.

Single.
No dependants.
Salary €47,000 p.a. Permanent job.
Savings €100,000.
Age: 36

House is €270,000.
Want to borrow €170,000 over 25 years.
He said I need to lower my expectations.
Surely with savings record, I have some hope?
That's built up over 14 years.

guylikeme

Rym Shanley wrote: »

I've just had a brief call with a broker who didn't fill me with confidence.

Single.
No dependants.
Salary €47,000 p.a. Permanent job.
Savings €100,000.
Age: 36

House is €270,000.
Want to borrow €170,000 over 25 years.
He said I need to lower my expectations.
Surely with savings record, I have some hope?
That's built up over 14 years.

Your credentials look good. Perhaps they are calculating based on your net salary though (probably <30K). Have you a parent that could act as guarantor to boost you up a notch?

Rym Shanley

Well my net monthly take-home is €2,850.
My current rent is €700.
I manage to save €700 minimum each month.

I'd say a mortgage of that size is €900 so hope to continue saving around €500 each month.

My father could guarantee it - he's still working - but would rather go it alone.

Greenmachine

I don't know what to say. That's Almost 40% of the Asking priced saved over 14 years that is really good going. Of course nobody know yet what will happen with the market. I can't imagine someone much better unless, you were with some with a second income. Surely he is not pushing for a 30 year mortgage. I you are in a reasonable position to meet repayments.

efb

Would you not push it out to 30? See what ha gets you? Then pay it off early if you can

Rym Shanley

Don't want anything more than 25 years term.
House is in Castleknock which means I can continue cycling to work.
One reason for being able to save is not running a car. I'm insured on my Dad's if I need to borrow one.
Broker suggested looking further afield but not really fancying that (he said go for somewhere around €240,000 or so).

Suppose I could continue saving for another year and that would narrow the gap.
But the prices might go up in the meantime.

Think I might approach bank or banks directly and see what they say.

Rym Shanley

presume I can apply for 27, 28 or 29 years though?

might compromise on that.

efb

Ask the banks, AIB and BOI are on here.

Fol20

As another poster said, why dont you go for the 30 year mark and then over pay and pay it off earlier?

Rym Shanley

thanks, will do

Trish56

Hi Rym,
You can actually borrow 3.5 times your gross salary which is €164,500 and I have just input your figures into a calculator and you can indeed borrow over a 25 year term. Also lenders are allowed exceptions on loan to income and based on proven affordability which you have by saving and paying rent of €1400 per month versus stressed repayments of €1095 also your savings profile you will have no problem in borrowing 170k.

Your broker does not appear to be up to speed or perhaps he/she is too busy however you are a prime candidate for a mortgage.

Rym Shanley

Thanks very much Trish, that's great to hear. Appreciate all the comments thank you

Nervous Wreck

Trish56 wrote: »

Hi Rym,
You can actually borrow 3.5 times your gross salary which is €164,500 and I have just input your figures into a calculator and you can indeed borrow over a 25 year term. Also lenders are allowed exceptions on loan to income and based on proven affordability which you have by saving and paying rent of €1400 per month versus stressed repayments of €1095 also your savings profile you will have no problem in borrowing 170k.

Your broker does not appear to be up to speed or perhaps he/she is too busy however you are a prime candidate for a mortgage.

Great advice. Dealing directly with a branch rather than broker might be a good way to go on this. Also, if you borrow over a longer period and then just overpay your mortgage payments every month, you will be able to shorten the term by simply having it paid off early!

Trish56

Thank you. Not necessary true that he be better off to deal with a branch as if you deal with a good broker who do not charge fees you can save a lot of time and more importantly money as a broker will know who is offering the best rates and terms. Also a broker will shop around and get you the best value mortgage protection policy while the bank will only offer their own product.

Nervous Wreck wrote: »

Great advice. Dealing directly with a branch rather than broker might be a good way to go on this. Also, if you borrow over a longer period and then just overpay your mortgage payments every month, you will be able to shorten the term by simply having it paid off early!

Adoolan85

Trish56 wrote: »

Thank you. Not necessary true that he be better off to deal with a branch as if you deal with a good broker who do not charge fees you can save a lot of time and more importantly money as a broker will know who is offering the best rates and terms. Also a broker will shop around and get you the best value mortgage protection policy while the bank will only offer their own product.

In fairness any monkey with a keyboard can shop around for mortgage protection online, absolutely no need for a broker.

My advice would definitely be to approach the banks directly. It is overall more personal, will give you a much better idea of how the whole process works and all options available will be laid out on the table in front of you.

Best of luck.

Trish56

All you need is time to visit a branch of each lender - permanent tsb, KBC, Bank of Ireland, AIB, EBS, Ulster Bank all with different policy, criteria to qualify, how much you can borrow and interest rates and compare when a good broker can supply this information to you in one visit telephone call or email.

Also banks treat their existing customers differently regarding interest rates and this info is good to know when applying for a mortgage. For example many banks charge their existing customers a higher fixed interest rate so its important at the outset to know who these are and a mortgage advisor in the branch certainly wont tell you that.

A mortgage is the biggest transaction you will make so its best to have the correct information at the outset.

Adoolan85 wrote: »

In fairness any monkey with a keyboard can shop around for mortgage protection online, absolutely no need for a broker.

My advice would definitely be to approach the banks directly. It is overall more personal, will give you a much better idea of how the whole process works and all options available will be laid out on the table in front of you.

Best of luck.

daheff

in fairness to the broker hes probably right....but just about.

If you think your house price is 270K. You can borrow 164.5K leaving 105.5K you need to find to fund it.

You have 100K as a deposit...but that doesn't cover the remaining amount due. I'm assuming the 100K is the full pot and that you haven't factored in legal fees & stamp duty (overall I'd guesstimate you'd need a further 5-7k for all this)...so you would seem to me to be short by about 10-12k.

If somebody could sort you out with the 12k I reckon you'd be fine for the mortgage.


But as others have said....go and apply for the mortgage with banks.