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

I'm just wondering, I'm a way away from getting a deposit sorted properly but would it make a difference whether I save it with the bank or with the credit union? Seems like the kind of thing that shouldn't make a difference but also the kind of stupid thing that could make a difference.

Cuddlesworth

Deleted User wrote: »

I'm just wondering, I'm a way away from getting a deposit sorted properly but would it make a difference whether I save it with the bank or with the credit union? Seems like the kind of thing that shouldn't make a difference but also the kind of stupid thing that could make a difference.

Makes no difference where you bank or where you save, as long as you save and can show proof.

conf101

Deleted User wrote: »

I'm just wondering, I'm a way away from getting a deposit sorted properly but would it make a difference whether I save it with the bank or with the credit union? Seems like the kind of thing that shouldn't make a difference but also the kind of stupid thing that could make a difference.

We had most of our savings in the bank and a small amount in the credit union. Bank didn't care where they were as long as we had statements to back it up and show a good savings history.

leburg

This forum has been invaluable to me, I’ve probably read most of the threads on here over the last few months, Just want to say thanks to everyone.

I got approval from 2 banks that I applied to at the end of November and seen a house we loved on 4th December and placed a bid that evening just under the asking and for what houses in the area are going for. Went sale agreed 5th December with booking deposit paid. Signed contracts on 19th December with a closing date of 19th January. Got an update today that the bank have released the funds to the solicitor.

The information on here has helped make decisions and has helped us move fast.

Looking forward to packing up and moving in.

Michellenman

izzyflusky wrote: »

Meeting today with a broker and applying. I'm assuming he'll be able to give us an idea of how much we can expect to be approved for, right? Was anyone surprised with a much lower offer than what they were expecting? And finally, once applying, how long does it usually take for them to get back?

As long as you're not expecting anything more that 3.5x combined salarys you won't be disappointed. In saying that, we were approved for significantly less than the online calculators would lead you to believe so if you've done them take a massive truck load of salt! Kbc calculator said 370k and I think they eventually gave aip for about 70k less.

Paul Pogba

Hi, first post here. Thanks for all the info I’ve read so far. So me and my wife are trying to buy a house at the moment. We’ve currently bid 340k and today the seller (house owner) contacted me and asked could we meet him. We don’t know him, the EA gave him out details.

Called over to his house and he has put it to us that if we were to put an amount towards the house directly to him, we could purchase the house for a bit less. For example, we pay him 30k and the price of the house goes to 320k (30 to the owner and 290 to the EA). No actual figures mentioned by him though. We have 240k in savings and are mortgage approved for enough to buy the house.

So I’m basically looking for advice here. Walk away or run or what should we do or what implications could it have for us short term and long term?? Thanks.

GingerLily

Michellenman wrote: »

As long as you're not expecting anything more that 3.5x combined salarys you won't be disappointed. In saying that, we were approved for significantly less than the online calculators would lead you to believe so if you've done them take a massive truck load of salt! Kbc calculator said 370k and I think they eventually gave aip for about 70k less.

The online calculator are bulsh*t, they suggested an amount for us that would have smothered us.
My friend was using one the other day and it was very frustrating that she believed she would be approved for that amount!!

izzyflusky

Michellenman wrote: »

As long as you're not expecting anything more that 3.5x combined salarys you won't be disappointed. In saying that, we were approved for significantly less than the online calculators would lead you to believe so if you've done them take a massive truck load of salt! Kbc calculator said 370k and I think they eventually gave aip for about 70k less.

The meeting with the broker went well. I'm assuming he has a different calculator that the ones available to the general public? We discussed getting an exception (just in case as I'm hoping not to need one, and he said it is a matter of just seen which bank will give us the best one (after putting the info in) but that we'll definitely be getting a certain amount. Not sure how accurate the figures he provided can be though or if I should just take it with a pinch of salt as well. In saying that, we are expecting AIP by friday week so we'll see.

LirW

Paul Pogba wrote: »

So I’m basically looking for advice here. Walk away or run or what should we do or what implications could it have for us short term and long term?? Thanks.

The vendor could potentially try to avoid tax duties.

Anyway, anecdote time: My partner has a close work relationship with a guy who recently was on the house hunt too. They found a house and had a winning bid but the seller pulled out shortly afterwards. The house went sale agreed for less and they found out they had been gazumped and the vendor was doing the same thing, taking some money under the table and sold the house for amount X.
Yer man's wife is a solicitor though and she pursued legal actions once she had proof for it because he was in fact dodging taxes.
I certainly can't tell you the outcome of it, have to ask my partner.


No advice I can give you but I'd certainly not go ahead with it simply because it'd feel wrong pulling one like that on the biggest purchase in my life.

Paul Pogba

LirW wrote: »

The vendor could potentially try to avoid tax duties.

Anyway, anecdote time: My partner has a close work relationship with a guy who recently was on the house hunt too. They found a house and had a winning bid but the seller pulled out shortly afterwards. The house went sale agreed for less and they found out they had been gazumped and the vendor was doing the same thing, taking some money under the table and sold the house for amount X.
Yer man's wife is a solicitor though and she pursued legal actions once she had proof for it because he was in fact dodging taxes.
I certainly can't tell you the outcome of it, have to ask my partner.


No advice I can give you but I'd certainly not go ahead with it simply because it'd feel wrong pulling one like that on the biggest purchase in my life.

Yep I’d imagine it’s to avoid tax, I’m not sure I’d feel right doing it this way either. Anyone else any advice?? Just want to get a few different perspectives on it so that I don’t feel I’m leaving anything behind or walking into something that could be a complete mess.

engineerfear1

I am currently looking at purchasing a home. I have been saving for a number of years and have built up a decent deposit (based on my salary).

Am I wasting my time applying for a mortgage at this time as a single applicant earning 40k a year? I would be looking at purchasing in Dublin, but I fear from reading this thread that I am only eligible for 3.5 times my salary which would be a mere 140k. That wouldn't get me anything in Dublin!

Is my only option to keep saving for a larger deposit or else hope for house prices to drop?

Mickiemcfist

Paul Pogba wrote: »

Yep I’d imagine it’s to avoid tax, I’m not sure I’d feel right doing it this way either. Anyone else any advice?? Just want to get a few different perspectives on it so that I don’t feel I’m leaving anything behind or walking into something that could be a complete mess.

I've never been through that situation, but I'd be concerned about the process. I.e. would he want cash before the legal asset transfer is done, if so you're leaving yourself wide open. I can't see him accepting it afterwards as he'll have already legally sold the house.

While I'm sure this sort of thing is done, I personally wouldnt want to do it that way.

Also, 240k in savings!!?!? I clearly picked the wrong career!

Cuddlesworth

Paul Pogba wrote: »

Hi, first post here. Thanks for all the info I’ve read so far. So me and my wife are trying to buy a house at the moment. We’ve currently bid 340k and today the seller (house owner) contacted me and asked could we meet him. We don’t know him, the EA gave him out details.

Called over to his house and he has put it to us that if we were to put an amount towards the house directly to him, we could purchase the house for a bit less. For example, we pay him 30k and the price of the house goes to 320k (30 to the owner and 290 to the EA). No actual figures mentioned by him though. We have 240k in savings and are mortgage approved for enough to buy the house.

So I’m basically looking for advice here. Walk away or run or what should we do or what implications could it have for us short term and long term?? Thanks.

Walk away.

You will need to declare the full amount to Revenue for Stamp duty and the correct property Tax valuation. Which means your solicitor will be transferring the full amount to his solicitor. Who is legally obliged to provide the bank with their funds first.

So for this to happen, it will start with you messing around with Revenue. And you never mess with Revenue.

shamrock55

Btw,is it 3.5 times your gross or net salary?

tusk

shamrock55 wrote: »

Btw,is it 3.5 times your gross or net salary?

Gross

JDD

Hi everyone

How difficult is it to find out the lending criteria regarding disposable income? Do any of the banks publish this?

We have a net monthly salary of €6,600. We have three kids, but only pay €800 a month in childcare costs as my parents help out. A stress tested mortgage payment, for the amount we're looking for, would be about €2500 a month. We have no credit card or personal loans.

From a google search what I have gleaned is that banks will generally say that we must have €2850 living costs (excluding rent or mortgage) for a couple with three kids (€2100 plus €250 per child). Childcare must then be added on, bringing us to €3650. A stress tested mortgage payment added on to that would bring us to €6150. So far, so affordable, if my google searching is indeed correct.

In addition, since last January we've been saving an average of €1000 a month in addition to our €1450 rent - so close enough to the stress tested mortgage payment.

The added wrinkle in our case is that I already own a house with my siblings. The house is in positive equity but not by a huge percentage. They have solely paid the mortgage for the past five years - I have not contributed anything. They can't buy me out, their income isn't enough, and I don't want to sell it. Would anyone know how much this might effect the calculation of our disposable income?

Mickiemcfist

I can't answer your question, but why won't you sell it if you're not willing to pay for it? Seems a touch unfair for them to have to pay the mortgage without you.

JDD

I went on the mortgage initially just so that they would be able to borrow more, as their combined income wasn't very high at the time. The house was always theirs - I contributed a small amount to the mortgage in the first couple of years but stopped, with their agreement, about five years ago. It's their principal private residence - they don't want to sell it and I don't want to force a sale either.

GingerLily

Your on the Mortgage so those mortgage payments will be a part of your assessment. A bank couldn't ignore your legal obligation to the other property.

This will decrease the amount you can borrow significantly

Mickiemcfist

JDD wrote: »

I went on the mortgage initially just so that they would be able to borrow more, as their combined income wasn't very high at the time. The house was always theirs - I contributed a small amount to the mortgage in the first couple of years but stopped, with their agreement, about five years ago. It's their principal private residence - they don't want to sell it and I don't want to force a sale either.

Apologies, I took that the complete opposite way.

polydactyl

So recently we have both gone up in salary in permanent jobs although I previously got a mortgage in my field while temp as it's a very stable field with zero unemployment.

Anyway at the moment our new salarys are combined over 200000. We have a mortgage of 1600 (20,000 neg equity) save 2400, childcare of 1700 (which will lessen in sept) no other debts apart from mortgage. However we only started saving properly for a second deposit so have 70,000 which is roughly 10% of a house in our area of Dublin. My question is how likely is it to get an exemption on the 20% deposit would you knowledgable people reckon? We also have potential additional earnings of 30,000 a year but not salaried that is all unspent apart from pre paying taxes or taxable expenses

ELM327

The amount you can borrow under the 3.5 rule will be reduced by the outstanding debt owed on the mortgage.
So if you can borrow 600k under the 3.5 rule but owe 150k remaining on the existing mortgage, you will only be able to borrow 450k not 600.

GingerLily

polydactyl wrote: »

So recently we have both gone up in salary in permanent jobs although I previously got a mortgage in my field while temp as it's a very stable field with zero unemployment.

Anyway at the moment our new salarys are combined over 200000. We have a mortgage of 1600 (20,000 neg equity) save 2400, childcare of 1700 (which will lessen in sept) no other debts apart from mortgage. However we only started saving properly for a second deposit so have 70,000 which is roughly 10% of a house in our area of Dublin. My question is how likely is it to get an exemption on the 20% deposit would you knowledgable people reckon? We also have potential additional earnings of 30,000 a year but not salaried that is all unspent apart from pre paying taxes or taxable expenses

Are you looking to sell your current house?

You should talk to the bank about a negative equity switch. The LTV wouldn't apply in that case

polydactyl

GingerLily wrote: »

Are you looking to sell your current house?

You should talk to the bank about a negative equity switch. The LTV wouldn't apply in that case

Yes we do want to sell it as we have no interest in being landlords. Excuse me but I am an idiot does that mean takin the excess owes after selling with us to a new mortgage?

Mickiemcfist

ELM327 wrote: »

The amount you can borrow under the 3.5 rule will be reduced by the outstanding debt owed on the mortgage.
So if you can borrow 600k under the 3.5 rule but owe 150k remaining on the existing mortgage, you will only be able to borrow 450k not 600.

Out of interest how do semi-professional landlords do it now? Is it just salary + annual rental income that they can multiply by 3.5 or is there a distinction with investment properties?

polydactyl

GingerLily wrote: »

Are you looking to sell your current house?

You should talk to the bank about a negative equity switch. The LTV wouldn't apply in that case

Yes we do want to sell it as we have no interest in being landlords. Excuse me but I am an idiot does that mean takin the excess owes after selling with us to a new mortgage?

GingerLily

polydactyl wrote: »

Yes we do want to sell it as we have no interest in being landlords. Excuse me but I am an idiot does that mean takin the excess owes after selling with us to a new mortgage?

I think you have to still have the 10% plus fees for your second house and then when you sell your first house the balance is added onto the new property. I don't know the exact rules for qualifying but if you're on a tracker currently it could be very beneficial to you.

Definitely talk to your bank, the bank you have the current mortgage with

Interested Observer

After what feels like a lifetime we've been granted approval in principle today. Delighted, can actually go looking seriously now.

JDD

ELM327 wrote: »

The amount you can borrow under the 3.5 rule will be reduced by the outstanding debt owed on the mortgage.
So if you can borrow 600k under the 3.5 rule but owe 150k remaining on the existing mortgage, you will only be able to borrow 450k not 600.

Apparently not though. EBS told us that first but PTSB said that as long as the house is in positive equity they’ll treat it as an investment property. Our broker wasn’t even aware of this. He approached KBC and they said they’d treat it the same way as will BOI. Of course, this was all initial discussions. Our applications are going through underwriting at the moment so the proof will be in the pudding. I’ll know next week.

Cuddlesworth

JDD wrote: »

Apparently not though. EBS told us that first but PTSB said that as long as the house is in positive equity they’ll treat it as an investment property. Our broker wasn’t even aware of this. He approached KBC and they said they’d treat it the same way as will BOI. Of course, this was all initial discussions. Our applications are going through underwriting at the moment so the proof will be in the pudding. I’ll know next week.

That's under the assumption that you sell that house, I believe. Otherwise they are starting to fudge the numbers already.