Saving/Applying for a mortgage 2015/16/17/18/19

Cina

awec wrote: »

It is like you buying a car on PCP and paying 200 quid a month, and then saving 200 quid a month to buy a new car in 2 years time and claiming that your car cost you 400 quid a month.

No, that car costs 200, you entirely of your own choice decided to save 200 extra on top of that for a period of time.

If you buy another house in 5 years time and start saving another 600pm for your next deposit your cost of living doesn't magically change to 1750 a month, you are still paying 1150 (or whatever it has changed to with interest changes) and are entirely optionally deciding to save more on the side for a period of time.

It's nothing like that.

Clearly we have differing views on this. I see putting money into savings for a deposit as critical (in most cases) towards getting away from rent and purchasing a house. For me, I'm no longer having to pay it, it's €600 extra for me a month (minus mortgage being more than rent) to spend, and now I can use it for whatever. maybe i'll still save part of it or maybe I'll just decide to live more comfortably, but I have my apartment and I don't need to save it anymore.

I'm not saying it's always the case but if you're wanting to buy property, most people HAVE to save.

Anyway I think we're going in circles here, each to their own, I'm looking forward to having that extra money to spend again though

mloc123 wrote: »

Yes but comparing rent + saving to a mortgage isn't a fair comparison IMO.
For a more direct comparison the amount saved for deposit split over the length of the mortgage is maybe... so 30k deposit over 30 years = 80e/month.

Most people save their deposit over a short period... 1-2 years, that is a short term expense. It isn't as if they will continue to save that amount for another 10 years and keep renting.

1-2 years? How much are you saving per month? Because it took me eight years to save enough to buy my property in Dublin, basically my entire twenties. And the longer I've waited, the higher prices have gone and the more I've needed for the deposit. And thankfully because I've saved more than I needed for the deposit I was able to include that and get a property I would otherwise not afford with just the mortgage.

There are only two situations where you shouldn't always be putting away money towards purchasing a home - if you have no intention of purchasing one and are happy to rent instead, or if you can't afford to.

Mickiemcfist

awec wrote: »

Also I am not suggesting it is a bad idea to buy. In almost all cases buying a property in Dublin will mean higher monthly outgoings, but if you can afford it then this still makes financial sense in the long run in many cases as you are paying off your own asset.

I am purely saying that people suggesting you can trim down your monthly expenses by buying are not being entirely correct. It is certainly possible, but would require you to buy somewhere that's a decent step down on where you rent (in most cases) in order to get monthly mortgage payments + other property ownership costs that come close to the rent rate.

I think where people may be getting caught up is age & mortgage length, it is in almost every situation cheaper for me to buy in Dublin. As an example, for me to rent a 3 bed apartment in stillorgan/blackrock it's on average 2500 per month. For me to buy one it's on average 400k, borrowing 350k over 30 years with kbc is 1,456 per month. That's a 1k per month gross saving by buying rather than renting in the same area, plus you're paying off equity.

zedhead

I'm not going to compare my current situation to the house we are buying as one is a small 2 bedroom apartment that is not in great condition and it under market value and the other is a 4 bedroom house with an attic conversion that is ready to move into. If I look up similar rental properties where our house is it is FAR FAR cheaper for us to buy than rent, factoring in rent vs mortgage/insurances/property tax/repairs.

We wouldnt be able to stay in our small apartment forever, it is no longer fit for our needs and who knows how high rents could go.



But in other news we picked up the keys today!! It feels very surreal and looking forward to officially moving in this weekend!! It has been such an awful year and I really thought this would never end and we would never have our home!

Noodles81

My fiance and I were told we would get our "mover" mortgage no bother. "No doubts about it" he said it was just a case of sending it to the underwriter. So on the strength of that we went sale agreed on our house. Then later that day we get word that we have to wait 6 months as we haven't a savings history. We have a combined income of over €100,000 with 2 car loans. We explained we have been spending due to the cost of getting engaged and booking the wedding. We were told that would be no problem.

We are only looking to borrow around 2.5 times our combined wages and we will have the 20% deposit with change from the sale of our house. We are trying another bank today. If we don't get it now the house we want will be too dear in 6 months time. Our bank said we lacked savings to show payment capacity but we have plenty of disposable income, we just were spending it on the wedding etc. I'm also in a pensionable state job so I'm guaranteed to have a salary, while my other half is permanent in the private sector.

heebusjeebus

Noodles81 wrote: »

My fiance and I were told we would get our "mover" mortgage no bother. "No doubts about it" he said it was just a case of sending it to the underwriter. So on the strength of that we went sale agreed on our house. Then later that day we get word that we have to wait 6 months as we haven't a savings history. We have a combined income of over €100,000 with 2 car loans. We explained we have been spending due to the cost of getting engaged and booking the wedding. We were told that would be no problem.

We are only looking to borrow around 2.5 times our combined wages and we will have the 20% deposit with change from the sale of our house. We are trying another bank today. If we don't get it now the house we want will be too dear in 6 months time. Our bank said we lacked savings to show payment capacity but we have plenty of disposable income, we just were spending it on the wedding etc. I'm also in a pensionable state job so I'm guaranteed to have a salary, while my other half is permanent in the private sector.

Did you get mortgage approval in principle before you bid on the house?
We found the broker over estimated what mortgage we would get by 30%. They are simply salesmen!

Cuddlesworth

Noodles81 wrote: »

My fiance and I were told we would get our "mover" mortgage no bother. "No doubts about it" he said it was just a case of sending it to the underwriter. So on the strength of that we went sale agreed on our house. Then later that day we get word that we have to wait 6 months as we haven't a savings history. We have a combined income of over €100,000 with 2 car loans. We explained we have been spending due to the cost of getting engaged and booking the wedding. We were told that would be no problem.

We are only looking to borrow around 2.5 times our combined wages and we will have the 20% deposit with change from the sale of our house. We are trying another bank today. If we don't get it now the house we want will be too dear in 6 months time. Our bank said we lacked savings to show payment capacity but we have plenty of disposable income, we just were spending it on the wedding etc. I'm also in a pensionable state job so I'm guaranteed to have a salary, while my other half is permanent in the private sector.

You come away with at least 5.5-6k a month after tax
It would appear you have no savings
You have two car loans.
Your deposit is banking on the sale of your current property.

To a underwriter, you do appear to be fiscally irresponsible.

mloc123

Cuddlesworth wrote: »

You come away with at least 5.5-6k a month after tax
It would appear you have no savings
You have two car loans.
Your deposit is banking on the sale of your current property.

To a underwriter, you do appear to be fiscally irresponsible.

I think it is more basic than that... while we were getting approval they have a criteria that your combined mortgage payments now + monthly savings should be equal or greater than the new mortgage payment. This is a central bank rule afaik.

Colonel Claptrap

2 car loans + an upcoming wedding strike me as red flags.

Can you pay off the loans using savings?

Going sale agreed without a mortgage seems crazy to me.

Is your current house on the market yet? Also do you have the 20% deposit in cash or are using the proceeds from your house sale as a deposit?

Noodles81

mloc123 wrote: »

I think it is more basic than that... while we were getting approval they have a criteria that your combined mortgage payments now + monthly savings should be equal or greater than the new mortgage payment. This is a central bank rule afaik.

Thanks I didn't know that but that's what the bank said to us too.

Cuddlesworth, thanks we agreed a sale on our own house as vendors but have not paid a holding deposit on the house we want. We were going to do all on Monday then the bank rang us but the other party already paid their deposit to our auctioneer by then.

We are trying another bank, my partners bank, but my question is do you think we'll get one at all at the minute without evidence of savings?

Noodles81

Colonel Claptrap wrote: »

2 car loans + an upcoming wedding strike me as red flags.

Can you pay off the loans using savings?

Going sale agreed without a mortgage seems crazy to me.

Is your current house on the market yet? Also do you have the 20% deposit in cash or are using the proceeds from your house sale as a deposit?

Thanks, we are going to make 80,000 on the sale and use most of it for the deposit. The gentleman in my bank said that would be grand, I just wished he'd cautioned me when he inputted our details but he was sure
We were strong candidates. Now we know different of course.

Cuddlesworth

Noodles81 wrote: »

Thanks I didn't know that but that's what the bank said to us too.

Cuddlesworth, thanks we agreed a sale on our own house as vendors but have not paid a holding deposit on the house we want. We were going to do all on Monday then the bank rang us but the other party already paid their deposit to our auctioneer by then.

We are trying another bank, my partners bank, but my question is do you think we'll get one at all at the minute without evidence of savings?

Nobody but the banks can answer that. All I can say is that every single bank we applied to wanted to see a defined history of savings.

starmc14

Just got notification that my contracts are ready for signing 😱😄

368100

Noodles81 wrote: »

My fiance and I were told we would get our "mover" mortgage no bother. "No doubts about it" he said it was just a case of sending it to the underwriter. So on the strength of that we went sale agreed on our house. Then later that day we get word that we have to wait 6 months as we haven't a savings history. We have a combined income of over €100,000 with 2 car loans. We explained we have been spending due to the cost of getting engaged and booking the wedding. We were told that would be no problem.

We are only looking to borrow around 2.5 times our combined wages and we will have the 20% deposit with change from the sale of our house. We are trying another bank today. If we don't get it now the house we want will be too dear in 6 months time. Our bank said we lacked savings to show payment capacity but we have plenty of disposable income, we just were spending it on the wedding etc. I'm also in a pensionable state job so I'm guaranteed to have a salary, while my other half is permanent in the private sector.

Is your new mortgage payment much more than your old one?

theboringfox

Noodles81 wrote: »

My fiance and I were told we would get our "mover" mortgage no bother. "No doubts about it" he said it was just a case of sending it to the underwriter. So on the strength of that we went sale agreed on our house. Then later that day we get word that we have to wait 6 months as we haven't a savings history. We have a combined income of over €100,000 with 2 car loans. We explained we have been spending due to the cost of getting engaged and booking the wedding. We were told that would be no problem.

We are only looking to borrow around 2.5 times our combined wages and we will have the 20% deposit with change from the sale of our house. We are trying another bank today. If we don't get it now the house we want will be too dear in 6 months time. Our bank said we lacked savings to show payment capacity but we have plenty of disposable income, we just were spending it on the wedding etc. I'm also in a pensionable state job so I'm guaranteed to have a salary, while my other half is permanent in the private sector.

This is ridiculous by the bank. You are only borrowing at 2.5x and have 20% equity. This is a great quality loan. They should be able to look beyond short term items like wedding. Car loans would be factored in but you have plenty capacity to absorb it. I would go to a broker and he'll get it through most banks.

I don't have full visibility on your finances but I think the bank in question has not properly assessed your loan.

You have my sympathies.

Noodles81

theboringfox wrote: »

This is ridiculous by the bank. You are only borrowing at 2.5x and have 20% equity. This is a great quality loan. They should be able to look beyond short term items like wedding. Car loans would be factored in but you have plenty capacity to absorb it. I would go to a broker and he'll get it through most banks.

I don't have full visibility on your finances but I think the bank in question has not properly assessed your loan.

You have my sympathies.

Thank you, theboringfox. To update the 2nd bank yesterday said we had to show 6 months savings AND clear the 2 car loans using the equity from the sale of our house. So I rang my bank again just to clarify and he said the loans were no problem with them, we just needed to show combined savings for 6 months and it should go through then. It's been a rollercoaster week but we learned a lot from it. We have set up a savings acc and we are going to take our house off the market, batten down the hatches and try again next Spring.

Thanks for all your advice folks.

Noodles81

368100 wrote: »

Is your new mortgage payment much more than your old one?

Hi, the mortgage would be double what we are paying now.

368100

Noodles81 wrote: »

Hi, the mortgage would be double what we are paying now.

So that's why they want to see savings record, so they know you can do without the increased payment. Mortgage advisor should have known this. You say you have plenty of disposable income, if you weren't saving did you build up a large credit balance in your current account from the surplus? Case could be made that this is as good as a savings record.

TheShow

mloc123 wrote: »

I think it is more basic than that... while we were getting approval they have a criteria that your combined mortgage payments now + monthly savings should be equal or greater than the new mortgage payment. This is a central bank rule afaik.

no its not.

TheShow

Noodles81 wrote: »

Thanks I didn't know that but that's what the bank said to us too.

Cuddlesworth, thanks we agreed a sale on our own house as vendors but have not paid a holding deposit on the house we want. We were going to do all on Monday then the bank rang us but the other party already paid their deposit to our auctioneer by then.

We are trying another bank, my partners bank, but my question is do you think we'll get one at all at the minute without evidence of savings?

You don't need to have savings if you have sufficient equity from the sale of your current house to put towards the purchase of a new property. I'd be appealing that to the bank and then to the formal appeals board (if that's the only decline reason).

Humour Me

The potential mortgage payment is higher than your current payment and you don't have evidence of savings to show that they can easily afford the higher payment amounts while covering their other expenses. Underwriters see evidence of consistent savings as an indicator of financial prudence and capacity.

Given the size of your combined salaries, the lack of regular savings is a red flag that you are just living within your means on your current mortgage payment and that you can't afford the higher payments.

whatever76

maybe a stupid question but here goes - in a bidding war currently and really at my peak so trying to go with head and not loose run of myself in all this madness - other bidders keep coming back 1k over mine ..grrrrr ( now 28k over asking) .. anyway was thinking is it possible to match the bid and just say let the vendors decide if it comes to it (I get feeling they want it closed out but hey that's just hear say ) and they decide who is less risky I guess ? I am good to go with everything lined up ( not in a chain etc) I know open to other last minutes bids but just means its really gone out of reach then - thinking out load really as I debate what to do and if I just move on from it.

Michellenman

whatever76 wrote: »

maybe a stupid question but here goes - in a bidding war currently and really at my peak so trying to go with head and not loose run of myself in all this madness - other bidders keep coming back 1k over mine ..grrrrr ( now 28k over asking) .. anyway was thinking is it possible to match the bid and just say let the vendors decide if it comes to it (I get feeling they want it closed out but hey that's just hear say ) and they decide who is less risky I guess ? I am good to go with everything lined up ( not in a chain etc) I know open to other last minutes bids but just means its really gone out of reach then - thinking out load really as I debate what to do and if I just move on from it.

First house we bid on we did this and the agent came back and said house went sale agreed to the other person. He told it wasn't possible to match bids.. The house we got we did the same thing, the other bidder came back 1k above us. We went to the agent and said that X amount (ie other bid minus 1k) was our final offer but if the vendor was more amenable to us being flexible with move dates and being first time buyers ready to go etc then we were still interested in the property. Also made sure to say to let us know if the sale didn't go through for whatever reason. Agent came back and said vendor preferred our profile and the fact that we always came back promptly with bids (other people were waiting a week+ between bids) and if we would match the other offer (didn't need to beat it) then the house was ours

Have spoken to a few friends who've had the same situation when they were selling their home. They sold to the under bidder because they preferred their circumstances and because the under bidder was ready to go with finances and wasn't in a chain.

Now, in our situation it could well have been a tactic by the agent and maybe there was no other bidder, we will never know that, so it's really important not to make any offer over what you are comfortable with and what you think the property is worth. No harm in giving it a shot though.

listermint

Michellenman wrote: »

First house we bid on we did this and the agent came back and said house went sale agreed to the other person. He told it wasn't possible to match bids.. The house we got we did the same thing, the other bidder came back 1k above us. We went to the agent and said that X amount (ie other bid minus 1k) was our final offer but if the vendor was more amenable to us being flexible with move dates and being first time buyers ready to go etc then we were still interested in the property. Also made sure to say to let us know if the sale didn't go through for whatever reason. Agent came back and said vendor preferred our profile and the fact that we always came back promptly with bids (other people were waiting a week+ between bids) and if we would match the other offer (didn't need to beat it) then the house was ours

Have spoken to a few friends who've had the same situation when they were selling their home. They sold to the under bidder because they preferred their circumstances and because the under bidder was ready to go with finances and wasn't in a chain.

Now, in our situation it could well have been a tactic by the agent and maybe there was no other bidder, we will never know that, so it's really important not to make any offer over what you are comfortable with and what you think the property is worth. No harm in giving it a shot though.

Vitally important advice and all to often not heeded in the heat of bids, people do and will put themselves into a fiscal handicap when they go chasing down bids in the heat of the moment. Always take pause for thought its a huge decision so the advice above its gold.

theboringfox

listermint wrote: »

Vitally important advice and all to often not heeded in the heat of bids, people do and will put themselves into a fiscal handicap when they go chasing down bids in the heat of the moment. Always take pause for thought its a huge decision so the advice above its gold.

Great advice. Financial strain is an awful thing as often no way to fix it. It's a roof over your head and you'd like it to be great but you need to live too. I know friends who have gone for exception based mortgages on the basis they will earn more in future. Depends on profession but I would not take the risk personally. In fact in current world I am nervous about maintaining my income.

whatever76

Thanks Michellenman - sound advice ! Still debating what to do - I am buying on my own so nervous of making the right/wrong decision - I can afford it now but as one poster just outlined I am nervous of maintaining my income as anything can change in the profession I am in !

ad1234

Guys has anyone had any experience with how long it typically takes fir ulsterbank to approve and draw down a mortgage? (Taking that there shouldn't be any hiccups)... contracts are ready and waiting... just the bank causing delays do wondering if this is the norm

Gastric Apple

Getting awfully frustrated with our situation. After a long 4 months our funds were finally drawn from the bank last Wednesday.

I was told on Friday by my solicitor what our remaining balance was and once I get that sent to them, they can send to the vendors solicitor and close. I sent the funds, along with the solicitor fee and stamp duty on Saturday gone and still waiting on a reply! We’re so close but yet feel so far! Surely it can’t be much longer?!

LirW

You're pretty much done, you'll receive the call to collect the keys soon!
Congratulations!

Mickiemcfist

I know there used to be a rule, but does the house have to be a 2 bed or above to be able to get a 90% mortgage? I've seen a few one beds I like

myshirt

Mickiemcfist wrote: »

I know there used to be a rule, but does the house have to be a 2 bed or above to be able to get a 90% mortgage? I've seen a few one beds I like

You won't see any mortgages for 1 beds go beyond 75%.