Advertisement
If you have a new account but are having problems posting or verifying your account, please email us on hello@boards.ie for help. Thanks :)
Hello all! Please ensure that you are posting a new thread or question in the appropriate forum. The Feedback forum is overwhelmed with questions that are having to be moved elsewhere. If you need help to verify your account contact hello@boards.ie

Mortgage not availing of help to buy

Options
  • 25-03-2018 5:51am
    #1
    utmbuilder
    Registered Users Posts: 471 ✭✭


    If a person is FTB and they do not avail of the help to buy tax grant and pay deposit from savings does the bank ask why?

    Or is it none of their business if you avail of it or not.


Comments

  • Options
    #2
    Heres Johnny
    Closed Accounts Posts: 2,738 ✭✭✭Heres Johnny


    utmbuilder wrote: »
    If a person is FTB and they do not avail of the help to buy tax grant and pay deposit from savings does the bank ask why?

    Or is it none of their business if you avail of it or not.

    Bank might not ask but do you mind if I ask why if you are eligible and the property is eligible why you wouldn't avail of it?

    It's a significant tax rebate you are turning down.


  • Options
    #3
    uberwolf
    Registered Users Posts: 7,580 ✭✭✭uberwolf


    the bank will look to understand the source of your deposit, whether that's savings, gift, htb or whatever other source. If I were an underwriter I'd be questioning the financial sanity of someone conscientiously objecting to the htb!!


  • Options
    #4
    utmbuilder
    Registered Users Posts: 471 ✭✭utmbuilder


    uberwolf wrote: »
    the bank will look to understand the source of your deposit, whether that's savings, gift, htb or whatever other source. If I were an underwriter I'd be questioning the financial sanity of someone conscientiously objecting to the htb!!

    Thanks guys will pass info on


  • Options
    #5
    tespor
    Registered Users Posts: 6 ✭tespor


    Hi,
    Resurrecting this thread if that's ok...
    If a first-time buyer couple have large savings and just need mortgage of 60% LTV but qualify for Help-to-buy, should they take out a mortgage of 70% LTV just to avail of the H2B and then make a lump sum repayment upon drawdown?
    Couple qualify for €24,500 from Help-to-buy if availing of it.
    Does it make sense to a) borrow more than needed or b) forfeit H2B and just borrow what they need?
    Thanks


  • Options
    #6
    jr1942
    Closed Accounts Posts: 45 ✭jr1942


    If you do use HTB, what happens if you decide you want to sell the property ie a year later?
    Surely there is some refund in place for Revenue?
    If so then it would make sense not to use it.


  • Advertisement
  • Options
    #7
    pooch90
    Registered Users Posts: 2,380 ✭✭✭pooch90


    AFAIK, you need to live in the property for 5 years, otherwise Revenue can claw some HTB back


  • Options
    #8
    purpleisafruit
    Registered Users Posts: 508 ✭✭✭purpleisafruit


    pooch90 wrote: »
    AFAIK, you need to live in the property for 5 years, otherwise Revenue can claw some HTB back
    This is correct but the clawback reduces on a sliding scale
    • Sell year 1, return 100% of HTB
    • Sell year 2, return 80% of HTB etc


  • Options
    #9
    Snotty
    Registered Users Posts: 1,298 ✭✭✭Snotty


    tespor wrote: »
    Hi,
    Resurrecting this thread if that's ok...
    If a first-time buyer couple have large savings and just need mortgage of 60% LTV but qualify for Help-to-buy, should they take out a mortgage of 70% LTV just to avail of the H2B and then make a lump sum repayment upon drawdown?
    Couple qualify for €24,500 from Help-to-buy if availing of it.
    Does it make sense to a) borrow more than needed or b) forfeit H2B and just borrow what they need?
    Thanks

    To answer your question, yes take out the mortgage of 70% LTV and keep some savings for "rainy day".
    This is good enough advise even if there wasn't a HTB reason to not put all savings into the deposit, you can also make lump sum payments in the future if your savings are not needed,


  • Options
    #10
    GingerLily
    Registered Users Posts: 4,767 ✭✭✭GingerLily


    tespor wrote: »
    Hi,
    Resurrecting this thread if that's ok...
    If a first-time buyer couple have large savings and just need mortgage of 60% LTV but qualify for Help-to-buy, should they take out a mortgage of 70% LTV just to avail of the H2B and then make a lump sum repayment upon drawdown?
    Couple qualify for €24,500 from Help-to-buy if availing of it.
    Does it make sense to a) borrow more than needed or b) forfeit H2B and just borrow what they need?
    Thanks


    Borrow more, you can always pay a lump sum into your mortgage (depending on you contract with the bank) after you drawdown.
    Personally I'd go for a 70% mortgage using the HTB, hold the rest of my savings aside and after a year or so when I've fully moved in and all costs have been considered I'd pay off more of the mortgage.

    There is no requirement to keep your LTV above 70% for any length of time, just that you drawdown at 70% LTV and you live in the property for 5 years.


  • Options
    #11
    Dolbhad
    Registered Users Posts: 782 ✭✭✭Dolbhad


    I agree with previous poster. If bank will lend to 70% I would go with it. You can always put the money aside if you don’t want to use it. There won’t be much in difference in interest rate between a LTV of 60% compared to 70%. And a mortgage is the cheapest money you can get at the moment if you needed to buy a car or stuff for the house.

    If you didn’t like the repayments for 70% mortgage, you could do a variable rate, draw down the HTB and mortgage and pay off a lump sum of the mortgage with the HTB funds and then fix your rate.


  • Advertisement
  • Options
    #12
    Q&A
    Registered Users Posts: 556 ✭✭✭Q&A


    Over borrowing can act as an insurance policy. It's a lot easier to use your savings to fix a burst pipe, leaky roof or boiler that's gone pop then trying to borrow extra money after you've already drawn down your mortgage.

    Financially it can make sense to increase your borrowings if your lender offers cashback. You can always pay a lump sum off soon after drawdown.

    To play devils advocate most banks offer a lower rate when the LTV is 60% or below so in addition to the extra interest expense on the 10% you didn't have to borrow you might face a higher interest rate on all of the mortgage.


  • Options
    #13
    GingerLily
    Registered Users Posts: 4,767 ✭✭✭GingerLily


    Dolbhad wrote: »
    If you didn’t like the repayments for 70% mortgage, you could do a variable rate, draw down the HTB and mortgage and pay off a lump sum of the mortgage with the HTB funds and then fix your rate.

    The HTB funds have to part of the 30% deposit I believe


  • Options
    #14
    fitzparker
    Registered Users Posts: 1,188 ✭✭✭fitzparker


    You can also do HTB retrospectively.

    We were not aware our house fell under HTB (as it was a "ghost house") we enquired about it this year (bought in 2017)

    HTB went through and it was nice to get 5% straight into our bank account!


  • Options
    #15
    GingerLily
    Registered Users Posts: 4,767 ✭✭✭GingerLily


    fitzparker wrote: »
    You can also do HTB retrospectively.

    We were not aware our house fell under HTB (as it was a "ghost house") we enquired about it this year (bought in 2017)

    HTB went through and it was nice to get 5% straight into our bank account!

    Unless your a self build or the contracts were signed in 2016, Revenue pay the builder, not the borrower!


  • Options
    #16
    fitzparker
    Registered Users Posts: 1,188 ✭✭✭fitzparker


    Thats right, and builder transferred it to us within hours of them getting it from revenue.


  • Options
    #17
    kevin1311
    Registered Users Posts: 2 ✭kevin1311


    Related question ...just looking at getting a mortgage for first time now, mid 30s...have what I think is a fairly hefty savings of just over 100k, single buyer no kids etc
    ..always thought I'd use the whole lot of this as a deposit or 90% of it anyway....am I way off the mark here with my expectations?!


  • Options
    #18
    Creamy Goodness
    Registered Users Posts: 26,578 ✭✭✭✭Creamy Goodness


    kevin1311 wrote: »
    Related question ...just looking at getting a mortgage for first time now, mid 30s...have what I think is a fairly hefty savings of just over 100k, single buyer no kids etc
    ..always thought I'd use the whole lot of this as a deposit or 90% of it anyway....am I way off the mark here with my expectations?!

    You won’t use 100% of it as you’ll need cash to pay for stamp duty and solicitors fees and other small miscellaneous stuff, that’s before you think of furniture and appliances if applicable. Run the figures and see what works best for your situation.


  • Options
    #19
    GingerLily
    Registered Users Posts: 4,767 ✭✭✭GingerLily


    kevin1311 wrote: »
    Related question ...just looking at getting a mortgage for first time now, mid 30s...have what I think is a fairly hefty savings of just over 100k, single buyer no kids etc
    ..always thought I'd use the whole lot of this as a deposit or 90% of it anyway....am I way off the mark here with my expectations?!

    How much of a mortgage do you expect to qualify for?


  • Options
    #20
    kevin1311
    Registered Users Posts: 2 ✭kevin1311


    GingerLily wrote: »
    How much of a mortgage do you expect to qualify for?

    ideally about 3.5 income which would be 180k, which if i threw in 100k of savings i'd know what type of price bracket to look for houses in; the prob in this would leave me light for furnishings and other stuff like contingencies etc so was just wondering basically would people normally use nearly every scrap of savings they had towards the deposit


  • Options
    #21
    Lonestar75
    Registered Users Posts: 5 ✭Lonestar75


    Hello,

    Long time observer, first time poster!

    I have a query in relation to clawback on an affordable property purchased in 2009 and hope someone could advise me.

    Purchased property in Jan 2009 for €199,750. Clawback was 26.02%. Therefore I understood the market value to be €270,000 and that the local council paid the remaining money - €70,250. At the time I was okay with this, grateful to get a property.

    Now looking to sell. Contacted local council and they confirmed clawback rate, and how between 10 years and 20 years this would reduced by 10% per year. So at this stage the clawback rate would be 21.07%. I was fine with this, still believing that they had paid over the €70,250 to meet the market value as the clawback rate was 26.02%.

    However, it transpires that they in fact only paid €50,000, as the property was sold for the overall price €249,750 and not €270,000 as I had believed it had. If this is the case, should the clawback original rate be 20.02%, not 26.02%?

    It won't make a difference at the moment as the market where I live leaves the price difference negligible, but I could be tempted to hold on for a year or 2, as the drop in the clawback rate will go substantially more in my favour.

    Any advice would be greatly appreciated


  • Advertisement
Advertisement