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

Bargain_Hound

Bananaleaf wrote: »

If you have been honest in your AIP application and you've no unusual activity on your account (lots of betting transactions, recent large transactions, for example I had bought a car in the 6months prior to applying and even though that cost was a once off, it was treated as part of my average spend) then I would imagine it's unlikely you will be denied.

About the full deposit amount, personally I wouldn't like the stress of not having it at time of sale agreed, but I'm sure plenty don't. For us, we went from sale agreed to sold in 6.5weeks, so we wouldn't have had time to make up a shortfall.

As well as the deposit, you need to have solicitor fees, stamp duty fee, fee for valuer, for surveyor and if you are buying second hand you may also have to reimburse the vendor for property tax for 2018. There are also utility bills to think of and possible reconnection fees for gas/electricity if the home hasn't been occupied.

Not trying to turn you off, and maybe you know all of that already so apologies if this comes across as condescending

Not condescending at all, advice taken

Honest application, clean ICB record, no loans, no credit card, deposit saved in saving account, salary work with pension.

My main concern would be giving notice on our current rental and loosing the approval at the last minute and loosing our rented property.

Regarding deposit, we have the deposit for our budget but if it came to several thousand shortfall, would hate to loose the right property over something that we could get up within a couple of weeks. Also have considered legal, stamp, surveying fees etc., very aware of additional costs.

fg1406

Monife wrote: »

What are the reasons to refuse mortgage protection cover, would a chronic condition make you uninsurable? Or is it more for the likes of people who have had heart bypass surgery or cancer?

Nope, it’s easy to be refused. I was denied cover for having an ovarian cyst and a history of anxiety.

Vetch

Bargain_Hound wrote: »

Applied for AIP on my own from my bank Wednesday, received it today! Was very straight forward and relaxed (ulster Bank). First viewing tomorrow already. Fingers crossed. First time buyer.

Question though, approval in principle is obviously not an agreement. Generally speaking and assuming the property is sound and I am in good health, if I was to get a bid accepted on a property, how common is it for the bank to deny full approval to cover the property purchase after offer is accepted and for what reasons?

Also, if the bid ón a property goes a little above your available deposit, are you given much time to generate the extra funds to cover the difference or is It acceptable to just ensure you have the full deposit amount at time of closing the agreement? (talking 4 or 5k)

Very new to all this

I'm not sure what you mean by the timeline here. Apologies if I'm saying things that you already understand here - The way deposits work is that you pay a booking deposit to the auctioneer when going sale agreed (4k in my case) and when signing the contract I paid a further sum to bring the deposit up to 10% of the total purchase price. The deposit is paid before the sale closes. The figures and percentages may well vary, I'm not sure. Depending on how it progresses you may have time between going sale agreed and contract signing to make up a shortfall, but you may not have much time if the vendor's side is on the ball. To look at it from the other side, if I was the vendor, I'd be nervous of a buyer who couldn't pay, especially if there were other buyers in the field.

Monife

fg1406 wrote: »

Nope, it’s easy to be refused. I was denied cover for having an ovarian cyst and a history of anxiety.

Wow, didn't know that they refused so easily. Makes me worried when we're ready to apply as we both have auto-immune conditions, his is fairly minor but mine does flare up from time to time although only caused me to be out of work for a month once years ago and not since.

fg1406

Monife wrote: »

Wow, didn't know that they refused so easily. Makes me worried when we're ready to apply as we both have auto-immune conditions, his is fairly minor but mine does flare up from time to time although only caused me to be out of work for a month once years ago and not since.

My advice is apply for life cover immediately because some banks will give you a waiver on the basis of 2-3 refusals and it takes time to get those.

CoconutSky

fg1406 wrote: »

My advice is apply for life cover immediately because some banks will give you a waiver on the basis of 2-3 refusals and it takes time to get those.

I agree. It could take up to 3 months to get a waiver sorted. Your GP may have to complete a PMA and some surgeries have a backlog of these to complete. It would be advisable to seek mortgage protection assurance BEFORE you even approach any banks for a mortgage if you have any health issues. You need 3 x decline / postponement letters from 3 separate insurance companies. I learned the extremely hard and stressful way. It worked out in the end but it took months!

adocholiday

Hi all,

My wife and I weren't planning to buy for a few months at least, but we were looking around and found our dream house. We had a quick chat with a mortgage broker who reckons we can easily mortgage it, but I have some concerns that you good people might help me with.

1. We have the deposit saved up, but it's in a current account. We never opened a dedicated savings account. The broker said it may be possible to show a history of savings there but I'm not convinced. Anyone have experience with this?

2. While we're not lavish spenders, we do treat ourselves to dinner/takeaway a couple of nights per week. Our bank statements would show a lot of these kinds of outgoings. How much scrutiny does the bank put on this? We'd have no gambling or other such expenses.

3. We went on a 'trip of a lifetime' in August for which we spent a lot of money and I fairly loaded the credit card. All paid off the following month though. Is this likely to be something that will affect an application?

4. Finally I have a car loan that I pay off every month and there's still 2 years left on it. Is that something that's likely to be a blocker?

Thanks for taking the time to read this!

tusk

adocholiday wrote: »

Hi all,

My wife and I weren't planning to buy for a few months at least, but we were looking around and found our dream house. We had a quick chat with a mortgage broker who reckons we can easily mortgage it, but I have some concerns that you good people might help me with.

1. We have the deposit saved up, but it's in a current account. We never opened a dedicated savings account. The broker said it may be possible to show a history of savings there but I'm not convinced. Anyone have experience with this?

2. While we're not lavish spenders, we do treat ourselves to dinner/takeaway a couple of nights per week. Our bank statements would show a lot of these kinds of outgoings. How much scrutiny does the bank put on this? We'd have no gambling or other such expenses.

3. We went on a 'trip of a lifetime' in August for which we spent a lot of money and I fairly loaded the credit card. All paid off the following month though. Is this likely to be something that will affect an application?

4. Finally I have a car loan that I pay off every month and there's still 2 years left on it. Is that something that's likely to be a blocker?

Thanks for taking the time to read this!

Hey, your situation sounds almost identical to mine, except we did use a separate savings account.

At the end of the day, the bank needs to know whether or not you will be able to pay each month. I would guess that if they can see that in your current account you are easily covering the repayments each month, it wouldn't be an issue.

Aside from that everything else is pretty much the same as us, and we had no major issues getting a loan offer.

Could be worth going and talking to a bank to see about the current account issue though.

Congrats and good luck!

Mickiemcfist

fg1406 wrote: »

My advice is apply for life cover immediately because some banks will give you a waiver on the basis of 2-3 refusals and it takes time to get those.

Are banks obliged to give a waiver if you have 3 refusals? I'm a few months off my planned deposit so will be approaching banks in probably June but imagine I'm unlikely to get life assurance.

fg1406

Mickiemcfist wrote: »

Are banks obliged to give a waiver if you have 3 refusals? I'm a few months off my planned deposit so will be approaching banks in probably June but imagine I'm unlikely to get life assurance.

They aren’t obliged to, no but you should ask each bank before you look for AIP what their policy is on life assurance waivers.

Bananaleaf

adocholiday wrote: »

Hi all,

My wife and I weren't planning to buy for a few months at least, but we were looking around and found our dream house. We had a quick chat with a mortgage broker who reckons we can easily mortgage it, but I have some concerns that you good people might help me with.

1. We have the deposit saved up, but it's in a current account. We never opened a dedicated savings account. The broker said it may be possible to show a history of savings there but I'm not convinced. Anyone have experience with this?

2. While we're not lavish spenders, we do treat ourselves to dinner/takeaway a couple of nights per week. Our bank statements would show a lot of these kinds of outgoings. How much scrutiny does the bank put on this? We'd have no gambling or other such expenses.

3. We went on a 'trip of a lifetime' in August for which we spent a lot of money and I fairly loaded the credit card. All paid off the following month though. Is this likely to be something that will affect an application?

4. Finally I have a car loan that I pay off every month and there's still 2 years left on it. Is that something that's likely to be a blocker?

Thanks for taking the time to read this!

The trip of a lifetime will be considered part of your average spend. I don't think I'm using the right terminology, so what I mean by this is that they will look at your spending for the past 6 months and that is the figure they will use to assess your disposable income.

I had bought a car within the 6month period of application and the money I spent on the car was factored into my ability to pay back.

I wasn't going to be buying a car every 6months, just like you won't be going on a trip of a lifetime every 6months, but the banks don't see it that way (well, BOI don't anyway)

It doesn't mean you can't get a mortgage. We still met the requirements, as I had only bought a 2nd hand car, but it was annoying them telling me I could only afford X amount when it wasn't the case at all.

The car loan will be factored in too. Children will be also if you have any. But, so long as you will be able to afford the repayments, the bank will approve you.

The_Conductor

fg1406 wrote: »

Nope, it’s easy to be refused. I was denied cover for having an ovarian cyst and a history of anxiety.

I was refused cover by 3 companies- and given a 200% with a loading from a 4th- as a result of having Crohn's Disease- despite being able to show less than 10 days sick leave in the previous 2 years (which was as a result of an accident I was in- and non-related to the Crohn's Disease).

Underwriters have strict criteria they operate under- and its black and white- you either fit under the bar- or you don't- and it doesn't really matter whether you have a good explanation or not- computer says no...........

Mortgagey

Question for those in the know:

I'm not quite at the 80% LTV threshold in terms of deposit (for the mortgage I would want) - as a first time buyer, that's ok...but, I know the rate would be better if I arrange a mortgage with <= 80% LTV.

Would I be best waiting +6 months or so to get there in terms of deposit, or is it relatively pain-free to get the bank to switch me to a lower band once I get there in due course from paying down principle?

Thanks in advance

Cuddlesworth

Mortgagey wrote: »

Question for those in the know:

I'm not quite at the 80% LTV threshold in terms of deposit (for the mortgage I would want) - as a first time buyer, that's ok...but, I know the rate would be better if I arrange a mortgage with <= 80% LTV.

Would I be best waiting +6 months or so to get there in terms of deposit, or is it relatively pain-free to get the bank to switch me to a lower band once I get there in due course from paying down principle?

Thanks in advance

Are you taking into account fees and taxes into the equation? I had to drop around 3k recently with all the fees and charges, plus stamp duty. And the banks like to see you have at least some money left over.

Mortgagey

Cuddlesworth wrote: »

Are you taking into account fees and taxes into the equation? I had to drop around 3k recently with all the fees and charges, plus stamp duty. And the banks like to see you have at least some money left over.

Thanks for response. Yes, my plan would be to make sure I have room to spare, to go towards starter furnishings etc. as well as the usual fees.

I suppose where I am going with it is how difficult the "LTV switch" might be. From subsequent reading, it seems at least some banks wouldn't want to know if you raise this. The only chance you might have is if you can provide some evidence that you could imminently switch to another provider (probably after a certified valuation and so on).

Anyone thought about this?

FinanceDublin

adocholiday wrote: »

Hi all,

My wife and I weren't planning to buy for a few months at least, but we were looking around and found our dream house. We had a quick chat with a mortgage broker who reckons we can easily mortgage it, but I have some concerns that you good people might help me with.

1. We have the deposit saved up, but it's in a current account. We never opened a dedicated savings account. The broker said it may be possible to show a history of savings there but I'm not convinced. Anyone have experience with this?

2. While we're not lavish spenders, we do treat ourselves to dinner/takeaway a couple of nights per week. Our bank statements would show a lot of these kinds of outgoings. How much scrutiny does the bank put on this? We'd have no gambling or other such expenses.

3. We went on a 'trip of a lifetime' in August for which we spent a lot of money and I fairly loaded the credit card. All paid off the following month though. Is this likely to be something that will affect an application?

4. Finally I have a car loan that I pay off every month and there's still 2 years left on it. Is that something that's likely to be a blocker?

Thanks for taking the time to read this!

I can answer 1. Got approved for a mortgage last month with identical scenario. Key is that it needs to show a steady uptick naturally, and can’t show any sudden depletions. So month 1 begins with 5000 and ends with 3000. Month 2 begins with 7000, etc etc.

On 3 - as mentioned here, it’ll just factor into your six month average incoming/outgoings.

Villa05

Mortgagey wrote:

Would I be best waiting +6 months or so to get there in terms of deposit, or is it relatively pain-free to get the bank to switch me to a lower band once I get there in due course from paying down principle?

Go variable now and switch to 10 year fixed when you hit the 80% threshold. 12 months should do it at current inflation rates. KBC and Bank of Ireland offer 10 year fixed rates. The process is much easier if you are sticking with the same bank

shamrock55

Is it ok to save in a credit union or would a bank prefer that you save with them

fg1406

shamrock55 wrote: »

Is it ok to save in a credit union or would a bank prefer that you save with them

Myself and husband saved in our CU. Bank weren’t bothered. We just had to provide 6 months statements showing regular savings that were untouched

Mickiemcfist

The_Conductor wrote: »

I was refused cover by 3 companies- and given a 200% with a loading from a 4th- as a result of having Crohn's Disease- despite being able to show less than 10 days sick leave in the previous 2 years (which was as a result of an accident I was in- and non-related to the Crohn's Disease).

Underwriters have strict criteria they operate under- and its black and white- you either fit under the bar- or you don't- and it doesn't really matter whether you have a good explanation or not- computer says no...........

How do they verify sick leave taken? Do they ring previous employers etc?

fg1406

Mickiemcfist wrote: »

How do they verify sick leave taken? Do they ring previous employers etc?

The PMA form completed by your gp requests details of certified time off work due to illness.

Mickiemcfist

fg1406 wrote: »

The PMA form completed by your gp requests details of certified time off work due to illness.

Crap, I always get told to take days off but I never take them.

Monife

If you're within your employer's sick leave limits and you get paid for sick leave, does this negate some of the risk when they're assessing you?

fg1406

Monife wrote: »

If you're within your employer's sick leave limits and you get paid for sick leave, does this negate some of the risk when they're assessing you?

Not for me. I only had 10 days out of work in total over last 9 years and was still refused. I get 6 months paid sick leave with my employer.

Mickiemcfist

fg1406 wrote: »

Not for me. I only had 10 days out of work in total over last 9 years and was still refused. I get 6 months paid sick leave with my employer.

What effect did the ten days have? I'd have similar

Monife

God, 10 days would probably be my yearly average, give or take a few!

Why, if you're under limits, is it taken into account? Surely most people get bouts of flu or a chest infection and need a few days off to recover. It doesn't affect their ability to repay their mortgage or impact on their income!

toby2111

This is worrying me.
How do mortgage protection companies get access to someone's sick leave? Do we have to submit them when applying for protection insurance?

zedhead

Monife wrote: »

God, 10 days would probably be my yearly average, give or take a few!

Why, if you're under limits, is it taken into account? Surely most people get bouts of flu or a chest infection and need a few days off to recover. It doesn't affect their ability to repay their mortgage or impact on their income!

toby2111 wrote: »

This is worrying me.
How do mortgage protection companies get access to someone's sick leave? Do we have to submit them when applying for protection insurance?

I think its only relevent if it is linked to a specific issue. i.e you disclose you have suffered depression and it asks how many days of work you have missed because of this. They can audit the information you provide with your permission from your doctor so if he/she signed you off due to the condition then it will be disclosed.

I disclosed anxiety but I have not missed any work in the past 5 years because of it so it did not affect my cover at all.

Interested Observer

shamrock55 wrote: »

Is it ok to save in a credit union or would a bank prefer that you save with them

I'm not saving with the bank that we're taking the mortgage out with, they don't seem to care as long as I'm demonstrating capacity to repay (i.e. putting the money away and not touching it).

Interested Observer

adocholiday wrote: »

4. Finally I have a car loan that I pay off every month and there's still 2 years left on it. Is that something that's likely to be a blocker?

Thanks for taking the time to read this!

As long as you're demonstrating your capacity to repay a stress-tested mortgage payment on top of your car loan, no this shouldn't be a problem. I have two personal loans (repayments combined are less than €300 per month so very small) but they don't seem to be an issue, having said that I'm waiting for approval at the moment so could all go wrong for me! But the mortgage advisor we have dealt with in the bank hasn't seemed concerned by the loans at all.