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Maintaining savings before applying for a mortgage?

  • 02-10-2015 9:07am
    #1
    Dapos
    Registered Users Posts: 617 ✭✭✭


    Hey,

    Just starting to look into applying for a mortgage. I've heard it's best to keep a fixed amount of saving before applying and not to take out of savings.

    I save regularly for years and I've been pushing myself to save 900 a month. Some months I need to take some money out though. With rent and the money my wife and I save I believe we would have no issues with mortgage repayment (and should be able to continue to save a little) but I'm just wondering would I be better off reducing savings to say 600 and transfer any surplus to the savings account each month or does it make any difference?


    Any advice would be appreciated.


Comments

  • #2
    MidMan25
    Closed Accounts Posts: 1,027 ✭✭✭MidMan25


    Probably best off to keep the regular savings at a manageable level.

    As long as your combined rent + savings per month cover the mortgage repayments you are looking for (at a stress tested interest rate) then you should be fine in terms of meeting that particular criteria.

    Obviously this is just one of the many things they look at when considering an application.

    The safest thing to do is to save into a couple of savings accounts. One that is solely for building a deposit + to prove ability to make repayments and should not be touched. The other savings account can be for short term savings where you may need to withdraw at some point for unforeseen circumstances.


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