Getting a mortgage @24 with probably the worst credit

ELM327

conf101 wrote: »

It's different strokes for different folks I guess but I agree with you. I went travelling for a few years. I'm back 3 years now and am almost at the point of buying my first house. Yes rent is a killer and has made saving for a deposit really difficult, yes house prices are higher than what they were 3 years ago.

Do I wish I already owned my own home? You bet! Do I wish I'd bought 4/5 years ago instead of going travelling? Hell no!

Telling a 24 year old to blow their savings on travelling isn't the most prudent advice. But telling them that there's no rush to jump into a mortgage and maybe look at other options is good advice IMO. If they go for the mortgage and it;s right for them, all well and good. But you don't want to look back and wish you'd spent your mid-20s seeing the world when it's too late.

But... if a 24 year old gets a mortgage they will be able to retire at 54. Or 49 for a 25 year mortgage.

Plenty of time then for travelling.

Wanderer78

ELM327 wrote:

But... if a 24 year old gets a mortgage they will be able to retire at 54. Or 49 for a 25 year mortgage.

Life truly can and does throw curveballs at you, you have no clue what may or may not happen during that period of your life. Traveling or even doing whatever you wanna do, May not be a possibility later in life, for whatever reasons. I think it's madness recommending young people to enter the world of debt. Watching the news yesterday, a bog standard house, in a nice part of Dublin, worth 600 grand! Come on folks, that's insane, the market is a mess. Even though I do understand the logic of recommending people to start their mortgage as early as possible, and it makes sense in ways, I still wouldn't do it, there truly is more to life, but best of luck to those that do.

ELM327

Wanderer78 wrote: »

Life truly can and does throw curveballs at you, you have no clue what may or may not happen during that period of your life. Traveling or even doing whatever you wanna do, May not be a possibility later in life, for whatever reasons. I think it's madness recommending young people to enter the world of debt. Watching the news yesterday, a bog standard house, in a nice part of Dublin, worth 600 grand! Come on folks, that's insane, the market is a mess. Even though I do understand the logic of recommending people to start their mortgage as early as possible, and it makes sense in ways, I still wouldn't do it, there truly is more to life, but best of luck to those that do.

Prices trend upwards historically.
Barring short periods (3 years or less) of boom/bust, house prices do not go down.

It's not "debt" if it is your PPR. It is an appreciating asset in most cases funded by leverage.

Wanderer78

ELM327 wrote:

It's not "debt" if it is your PPR. It is an appreciating asset in most cases funded by leverage.

We need to stop thinking like this, it's actually potentially very dangerous for our society. We are creating an environment of 'debt peonage' for all in society, for something that all require. Our housing needs are not a privilege, but a necessity. Each new generation is being indebted more than the last, this is unsustainable, it is destabilising our socioeconomic systems and models. All this thinking does is create rentier classes and debt bondage for the majority

ELM327

Wanderer78 wrote: »

We need to stop thinking like this, it's actually potentially very dangerous for our society. We are creating an environment of 'debt peonage' for all in society, for something that all require. Our housing needs are not a privilege, but a necessity. Each new generation is being indebted more than the last, this is unsustainable, it is destabilising our socioeconomic systems and models. All this thinking does is create rentier classes and debt bondage for the majority

Interesting.
Did your parents, their parents etc not get a mortage for their house?

Wanderer78

ELM327 wrote: »

Interesting.
Did your parents, their parents etc not get a mortage for their house?

they did of course, but if you look at the work of somebody such as steve keen, you ll see in the last couple of decades, the levels of debt, in particular private debt, have soared. one of the main reasons for this is the rising cost of housing. one of the main problems with this model is the fact that tak home pay for a very large portion of society isnt rising as fast to meet this rising levels of debt, i.e. for each new generation, a larger amount of take home pay is required to service debts, and in many if not most cases, thats mortgage debt. its a completely unsustainable and unstable economic model. as said previously, all its doing is creating a rentier class, which only truly benefits the minority in society. at some stage we have to stop this, and come up with something better. also bare in mind, since the era of the job for life is coming to an end, people are required to move more for work. this is a paradox, as we all know, selling and buying homes or even becoming a landlord, isnt straightforward, and fraught with complexity.

ELM327

Wanderer78 wrote: »

they did of course, but if you look at the work of somebody such as steve keen, you ll see in the last couple of decades, the levels of debt, in particular private debt, have soared. one of the main reasons for this is the rising cost of housing. one of the main problems with this model is the fact that tak home pay for a very large portion of society isnt rising as fast to meet this rising levels of debt, i.e. for each new generation, a larger amount of take home pay is required to service debts, and in many if not most cases, thats mortgage debt. its a completely unsustainable and unstable economic model. as said previously, all its doing is creating a rentier class, which only truly benefits the minority in society. at some stage we have to stop this, and come up with something better. also bare in mind, since the era of the job for life is coming to an end, people are required to move more for work. this is a paradox, as we all know, selling and buying homes or even becoming a landlord, isnt straightforward, and fraught with complexity.

Are you aware of the supply/demand curve?
Not enough houses are built, so the supply is down and demand is up, therefore the prices increase.
Simples.

conf101

ELM327 wrote: »

But... if a 24 year old gets a mortgage they will be able to retire at 54. Or 49 for a 25 year mortgage.

Plenty of time then for travelling.

Plenty of time indeed, if that's what they want to do. But I would say that travelling in your mid-50s is a very different experience to travelling in your mid-20s. And perhaps by 55 they'll be mortgage free, but what about career/kids at that stage? They may not be able to retire.

Wanderer78

ELM327 wrote: »

Are you aware of the supply/demand curve?
Not enough houses are built, so the supply is down and demand is up, therefore the prices increase.
Simples.

now you re getting to the crux of the problem, as far as i can see, there is now sufficient evidence to show that the 'efficient market hypothesis' is a bust, and isnt exactly efficient. the supply and demand model, models such as dsge models, have failed countless of times in predicting future events and needs. i do believe microeconomic models such as supply and demand curves cannot be used accurately to explain and predict complex markets such as our housing markets. i will agree though that supply is one of the main reasons why our housing prices are increasing rapidly, but our housing needs were spotted many years ago, but little or nothing was done, and continues to do so. sadly it looks like our homeless numbers will reach 10,000 in the near future. its time for us to move on from all this supply and demand nonsense.

Larbre34

A lot of comment interfering in this persons life beyond the question that was asked.

To the OP, get your ICB and then perhaps speak to a broker you can get a good recommendation for, or talk to a couple of banks directly. I'd be surprised if you didn't get at least a few pre-approvals on the back of your deposit. Then at least you can make informed decision about your options in life.

sbsquarepants

Wanderer78 wrote: »

go off traveling for a while op, dont mind getting involved in this nonsense, life really is too short

Having a house won't necessarily stop you from travelling, blowing your deposit money on a holiday however will necessarily stop you from buying!

If you want to travel there's nothing stopping you from buying, then renting it out and going travelling, I know a couple of people who have done just that.

Prices, in my opinion, are only going one way for the foreseeable future, rents are sky high. Makes absolutely no sense to wait if you can buy now, whether you want to travel or not. It's not like Cambodia is closing down next month!

ELM327

Wanderer78 wrote: »

now you re getting to the crux of the problem, as far as i can see, there is now sufficient evidence to show that the 'efficient market hypothesis' is a bust, and isnt exactly efficient. the supply and demand model, models such as dsge models, have failed countless of times in predicting future events and needs. i do believe microeconomic models such as supply and demand curves cannot be used accurately to explain and predict complex markets such as our housing markets. i will agree though that supply is one of the main reasons why our housing prices are increasing rapidly, but our housing needs were spotted many years ago, but little or nothing was done, and continues to do so. sadly it looks like our homeless numbers will reach 10,000 in the near future. its time for us to move on from all this supply and demand nonsense.

AAaaaand at that, I'm out.
Enjoy your tinfoil hat.

Wanderer78

ELM327 wrote: »

AAaaaand at that, I'm out.
Enjoy your tinfoil hat.

theres nothing tinfoil about this, some many respected academics have been writing about these issues for many years, even decades

Graham

Wanderer78 wrote: »

now you re getting to the crux of the problem, as far as i can see, there is now sufficient evidence to show that the 'efficient market hypothesis' is a bust, and isnt exactly efficient. the supply and demand model, models such as dsge models, have failed countless of times in predicting future events and needs. i do believe microeconomic models such as supply and demand curves cannot be used accurately to explain and predict complex markets such as our housing markets. i will agree though that supply is one of the main reasons why our housing prices are increasing rapidly, but our housing needs were spotted many years ago, but little or nothing was done, and continues to do so. sadly it looks like our homeless numbers will reach 10,000 in the near future. its time for us to move on from all this supply and demand nonsense.

So we should have historically moved on from 'all this supply and demand nonsense' by increasing supply to meet demand?

ELM327

Graham wrote: »

So we should have historically moved on from 'all this supply and demand nonsense' by increasing supply to meet demand?

No no, we should all be given free houses.
But not to John Smith the citizen, but instead to John of the family Smith, human of the earth.

#freemanoftheland

I never consented to supply and demand as a theorem, so i am not accepting it as reality.

listermint

One thing i know il be saying on my deathbed is, Im glad i took that mortgage out young so i could own my own property.

Best time of my life

emeldc

wordofwarning wrote: »

I know someone who rejected a mortgage based on the fact, they missed a single credit card payment years ago.

So my CC bill for last month was €1200. I paid it in full. But my minimum payment was €36. Are you saying that if I miss that payment of €36 that it goes against my credit rating for 5 years. That cant be right. I don't owe anyone a bob.

ELM327

emeldc wrote: »

So my CC bill for last month was €1200. I paid it in full. But my minimum payment was €36. Are you saying that if I miss that payment of €36 that it goes against my credit rating for 5 years. That cant be right. I don't owe anyone a bob.

Yes if you miss the minimum payment one month then pay the full balance the next month you have a black mark for 5 years.

Worth noting that a credit card payment is not deemed "late" by the ICB until 30 days pass after the due date.

emeldc

ELM327 wrote: »

Yes if you miss the minimum payment one month then pay the full balance the next month you have a black mark for 5 years.

Worth noting that a credit card payment is not deemed "late" by the ICB until 30 days pass after the due date.

Jesus, that's scandalous. Sure anyone can forget. Don't know what else to say about it really except the OP looks like he's fcuked.

glic71rods46t0

ELM327 wrote: »

Yes if you miss the minimum payment one month then pay the full balance the next month you have a black mark for 5 years.

Worth noting that a credit card payment is not deemed "late" by the ICB until 30 days pass after the due date.

Not correct. ICB has a 24 month "foot print" so any missed payment will fall off after 24 months.

notsoyoungwan

emeldc wrote: »

Jesus, that's scandalous. Sure anyone can forget. Don't know what else to say about it really except the OP looks like he's fcuked.

Best way to avoid that is to set up a direct debit allowing the credit card company take the minimum payment due each month, at least then you won't be late. You can also instruct them to take the full amount by direct debit. (Goes without saying the best thing is to pay it in full and on time!)