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A loan on top of the mortgage??

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  • 19-03-2018 9:11am
    #1
    Johnc35
    Registered Users Posts: 27 ✭


    Hi Everyone, just wondering if anyone got a loan on top of a mortgage to buy their house? We have our eye on a house that will sale agree on €180k but we were only approved €160k.was thinking that we could apply for a loan from the credit union for the missing €20k so that we could put the 2 together and buy the house. Can that be done? We're well aware that there are legal fees ect for buying a house but we're ok for that, also furnishing the house ect..
    Thanks


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    #2
    ELM327
    Registered Users Posts: 21,990 ✭✭✭✭ELM327


    The bank will not give you the mortgage in that instance, you need to provide the savings to make up the rest.
    You cannot borrow part of the house cost, those days are gone. The bank will not allow anyone else to have a lien on the property


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    #3
    TheIronyMaiden
    Registered Users Posts: 188 ✭✭TheIronyMaiden


    ELM327 wrote: »
    The bank will not give you the mortgage in that instance, you need to provide the savings to make up the rest.
    You cannot borrow part of the house cost, those days are gone. The bank will not allow anyone else to have a lien on the property

    This. We're currently waiting on our approval in principle, went through a broker and he said there was no point in applying until we had the savings to support our application.


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    #4
    SNNUS
    Registered Users Posts: 746 ✭✭✭SNNUS


    Savings history is of the upmost importance, if you do not have the funds to make €180k then you will have to renegotiate the price or go for a different property.

    Only one loan on a house i.e. Your mortgage can apply. A credit union loan is not allowed and is a terrible financial decision.


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    #5
    Cash_Q
    Registered Users Posts: 1,920 ✭✭✭Cash_Q


    A friend who was bidding on a hosue that kept going up had her mother take out a credit union loan of 20k to bring her up (madness in my view and they were outbid anyway). What's to stop op doing this if parents willing and op feels they can make the repayments?

    Personally I wouldn't do it to my parents but could a bank prove it wasn't just a gift from parents?


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    #6
    Samuel T. Cogley
    Registered Users Posts: 10,684 ✭✭✭✭Samuel T. Cogley


    Cash_Q wrote: »
    A friend who was bidding on a hosue that kept going up had her mother take out a credit union loan of 20k to bring her up (madness in my view and they were outbid anyway). What's to stop op doing this if parents willing and op feels they can make the repayments?

    Personally I wouldn't do it to my parents but could a bank prove it wasn't just a gift from parents?

    They can't but will be covered by a letter from the parents stating it's a gift with no expectation of repayment.


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    #7
    ELM327
    Registered Users Posts: 21,990 ✭✭✭✭ELM327


    Samuel T. Cogley wrote: »
    They can't but will be covered by a letter from the parents stating it's a gift with no expectation of repayment.
    And this is true even if there was an expectation/agreement that the mortgage applicant would actually be making repayments.


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    #8
    Johnc35
    Registered Users Posts: 27 ✭Johnc35


    ELM327 wrote: »
    The bank will not give you the mortgage in that instance, you need to provide the savings to make up the rest.
    You cannot borrow part of the house cost, those days are gone. The bank will not allow anyone else to have a lien on the property

    We have the savings and the mortgage is approved already, but only for €160, if we got a loan for a car let's say then there would be no other lien on the property no?


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    #9
    Cash_Q
    Registered Users Posts: 1,920 ✭✭✭Cash_Q


    Johnc35 wrote:
    We have the savings and the mortgage is approved already, but only for €160, if we got a loan for a car let's say then there would be no other lien on the property no?

    But the bank will see the 20k, query where it's from, then notice immediately when you use it for the house and not for a car..


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    #10
    Johnc35
    Registered Users Posts: 27 ✭Johnc35


    SNNUS wrote: »
    Savings history is of the upmost importance, if you do not have the funds to make €180k then you will have to renegotiate the price or go for a different property.

    Only one loan on a house i.e. Your mortgage can apply. A credit union loan is not allowed and is a terrible financial decision.

    We are approved for €160 SNNUS, just thinking we could get a loan for the extra 20k to make up the funds we need and say its for a car for example. We can afford the 2.


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    #11
    Johnc35
    Registered Users Posts: 27 ✭Johnc35


    Cash_Q wrote: »
    But the bank will see the 20k, query where it's from, then notice immediately when you use it for the house and not for a car..

    How would they know?


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    #12
    AndrewJRenko
    Registered Users Posts: 29,003 ✭✭✭✭AndrewJRenko


    Johnc35 wrote: »
    We are approved for €160 SNNUS, just thinking we could get a loan for the extra 20k to make up the funds we need and say its for a car for example. We can afford the 2.
    If you have to lie to your bank to get funds, that's a pretty good indication that it's not a good idea to get those funds. You really need to think about whether this level of borrowing is a good idea. This is the kind of borrowing that can end up in serious difficulties when one party loses their job, or a kid or two arrive that weren't built into the plan.


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    #13
    Stheno
    Moderators, Business & Finance Moderators, Science, Health & Environment Moderators, Society & Culture Moderators Posts: 51,688 Mod ✭✭✭✭Stheno


    Johnc35 wrote: »
    We are approved for €160 SNNUS, just thinking we could get a loan for the extra 20k to make up the funds we need and say its for a car for example. We can afford the 2.

    If you get a car lian from the credit union they will look for proof it was used to buy a car


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    #14
    Cash_Q
    Registered Users Posts: 1,920 ✭✭✭Cash_Q


    Johnc35 wrote:
    How would they know?


    When you are successful on a property they will seek to have it valued and the contract will contain the purchase price. They will know how much they are lending you. They will be aware of your savings from the mortgage application process. They will then wonder about the shortfall, seek to clarify how this is being made up, seek up to date bank statements, see the 20k deposit...wonder where it came from...


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    #15
    Scraggs
    Registered Users Posts: 5,578 ✭✭✭Scraggs


    If you and your partner are first time buyers the Rebuilding Ireland Home Loan scheme might be an option for you (google it). If you take out a loan from your Credit Union it will be on your credit report which is available to the banks so there is no sneaky way to get a loan these days... which is a good thing!


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    #16
    4ensic15
    Banned (with Prison Access) Posts: 4,691 ✭✭✭4ensic15


    Johnc35 wrote: »
    We are approved for €160 SNNUS, just thinking we could get a loan for the extra 20k to make up the funds we need and say its for a car for example. We can afford the 2.

    If you want a 20k car loan the bank will want details of the car. Likewise the credit union. The car would be the security for the 20k. The lender will want make, model, chassis number and the name of the selling garage.


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    #17
    SNNUS
    Registered Users Posts: 746 ✭✭✭SNNUS


    Johnc35 wrote: »
    We are approved for €160 SNNUS, just thinking we could get a loan for the extra 20k to make up the funds we need and say its for a car for example. We can afford the 2.

    There is no way to have this 20k slip under the radar, Credit union will want details of the car and also this will be added to the Irish credit bureau and the bank can access and see the details of the loan. Don't let your heart rule your head which can happen with property, The rebuilding Ireland homeloan may be an option for you.


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    #18
    van_beano
    Registered Users Posts: 1,345 ✭✭✭van_beano


    Wouldn't a car loan cheque or draft be made out to the garage's name anyways?


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    #19
    Cuddlesworth
    Registered Users Posts: 13,994 ✭✭✭✭Cuddlesworth


    Cash_Q wrote: »
    A friend who was bidding on a hosue that kept going up had her mother take out a credit union loan of 20k to bring her up (madness in my view and they were outbid anyway). What's to stop op doing this if parents willing and op feels they can make the repayments?

    Personally I wouldn't do it to my parents but could a bank prove it wasn't just a gift from parents?

    Its fraud for a start.


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    #20
    Johnc35
    Registered Users Posts: 27 ✭Johnc35


    4ensic15 wrote: »
    If you want a 20k car loan the bank will want details of the car. Likewise the credit union. The car would be the security for the 20k. The lender will want make, model, chassis number and the name of the selling garage.

    If I was buying privately there wouldn't be a garage name but thanks for your point anyway


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    #21
    Johnc35
    Registered Users Posts: 27 ✭Johnc35


    van_beano wrote: »
    Wouldn't a car loan cheque or draft be made out to the garage's name anyways?

    Not if you were buying privately


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    #22
    GingerLily
    Registered Users Posts: 4,767 ✭✭✭GingerLily


    What deposit do you have? Do you currently have the deposit plus stamp duty and legal fees?


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    #23
    Interested Observer
    Registered Users Posts: 13,106 ✭✭✭✭Interested Observer


    Johnc35 wrote: »
    How would they know?

    How would they know what?

    What they will see is mystery €20k landing in your account and they'll want to know where it came from. What will you tell them?


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    #24
    soc
    Registered Users Posts: 488 ✭✭soc


    Johnc35 wrote: »
    We are approved for €160 SNNUS, just thinking we could get a loan for the extra 20k to make up the funds we need and say its for a car for example. We can afford the 2.

    If the Bank thought you could afford the €180K then the Bank would have given it to you.... according to the Bank's calculations & stress-testing, they think you should only get €160K. Therein lies the reality.


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    #25
    Johnc35
    Registered Users Posts: 27 ✭Johnc35


    soc wrote: »
    If the Bank thought you could afford the €180K then the Bank would have given it to you.... according to the Bank's calculations & stress-testing, they think you should only get €160K. Therein lies the reality.

    We didn't apply for 180k, we applied for 160k because we had the 10% deposit saved which is 16k, we could continue saving and reapply for 180k but I'm pretty sure the house will be gone by then!


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    #26
    Johnc35
    Registered Users Posts: 27 ✭Johnc35


    Interested Observer wrote: »
    How would they know what?

    What they will see is mystery €20k landing in your account and they'll want to know where it came from. What will you tell them?

    I could say that it was a gift from family or friends to help with the house price


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    #27
    Johnc35
    Registered Users Posts: 27 ✭Johnc35


    GingerLily wrote: »
    What deposit do you have? Do you currently have the deposit plus stamp duty and legal fees?

    Hi gingerlily, we have 16k deposit and we applied for 160k and we were approved. Yes we have stamp duty and legal fees. Only problem is that a house we really like was put up for 160k, which we could have bought no problem with the mortgage, but the bidding has put the price up nearly 20k...we've been told that 180k will get us the house


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    #28
    4ensic15
    Banned (with Prison Access) Posts: 4,691 ✭✭✭4ensic15


    Johnc35 wrote: »
    I could say that it was a gift from family or friends to help with the house price

    they will want a letter from the family or friends confirming the fact of the gift and stating that it is indeed a gift and that there will be no claim to any equity in the property from the family or friends. They will also check the credit control for any outstanding loans to you. The banks are under a duty to inquire as to the source of any funds in your bank account if there is a lodgement of that amount.


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    #29
    Johnc35
    Registered Users Posts: 27 ✭Johnc35


    4ensic15 wrote: »
    they will want a letter from the family or friends confirming the fact of the gift and stating that it is indeed a gift and that there will be no claim to any equity in the property from the family or friends. They will also check the credit control for any outstanding loans to you. The banks are under a duty to inquire as to the source of any funds in your bank account if there is a lodgement of thatamount.

    That would be no problem 😉


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    #30
    SNNUS
    Registered Users Posts: 746 ✭✭✭SNNUS


    Not sure you are taking anyone's advice onboard to be honest..


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    #31
    4ensic15
    Banned (with Prison Access) Posts: 4,691 ✭✭✭4ensic15


    Johnc35 wrote: »
    4ensic15 wrote: »
    they will want a letter from the family or friends confirming the fact of the gift and stating that it is indeed a gift and that there will be no claim to any equity in the property from the family or friends. They will also check the credit control for any outstanding loans to you. The banks are under a duty to inquire as to the source of any funds in your bank account if there is a lodgement of thatamount.

    That would be no problem ��

    So they get a fraudulent letter from your family friends and then find the source of the money was a loan from another institution? Your chances of a mortgage are gone and you might have a criminal charge to deal with.


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