Sell house first?

catrionanic

Never sold a house before, so looking for some advice!

We have to sell our two-bed as we’ve outgrown it. It should sell pretty quickly as it’s in great condition and in a very desirable part of Dublin.

Obviously we need to buy a new house, and would like to avoid renting in between the sale and purchase.

My husband is in his probation period until the end of June so I doubt we would be able to apply for mortgage approval before then.

We also have our second child due in October so would like to avoid making any moves in October or November.

Would we be wiser to get our house on the market now, a month or two in advance of us getting mortgage approval and even being able to make a bid on a new place?

Or are we likely to end up having to move out before we would have a new house to go too, possibly with everything being up in the air around the time of the new arrival?

My head is spinning.

LirW

Given you have the deposit you need, I'd start get the ball rolling. AFAIK you can apply for mortgage approval but not draw it down before probation is over, not 100% sure about that though.

What would stress me more is the fact you are having your baby in October. A second child would lower the amount you could borrow from the bank, while a lot of banks don't care when it's not born yet.
So I'd either start to get the ball rolling now or after the baby. Depending on the time frame you might not move before the baby anyway.

I'd try talk to an experienced broker about your situation and start looking around now.

ted1

FYI: Come October when the baby is born you will get a much smaller mortgage from the bank as they reduce your repayment capacity.

Watch out for this.

catrionanic

Thanks guys. I’m aware that most banks deduct €250 per child per month. How does this work practically though - do they add that up for the year to 3k and deduct that from your combined salaries when calculating mortgage amount?

ted1

catrionanic wrote: »

Thanks guys. I’m aware that most banks deduct €250 per child per month. How does this work practically though - do they add that up for the year to 3k and deduct that from your combined salaries when calculating mortgage amount?

If you monthly take home is 4K, they look as if your take home is 3,250 also if you have one income they’ll treat the spouse as a dependent and take 500 off, so you might be assessed on 2,750 instead of 4K

jlm29

I was on mat leave with our third child when we applied for our mortgage, and they also asked me how much we would be paying for childcare after I went back to work, I’m addition to the €250 they were subtracting.

jlm29

jlm29 wrote: »

I was on mat leave with our third child when we applied for our mortgage, and they also asked me how much we would be paying for childcare after I went back to work, I’m addition to the €250 they were subtracting.

ETA- they added our joint monthly incomes together, subtracted (I think) €1025 per adult, €750 for the three kids, the loan repayments we have for three loans, childcare, and what was left after that was what we could afford to pay monthly

catrionanic

jlm29 wrote: »

ETA- they added our joint monthly incomes together, subtracted (I think) €1025 per adult, €750 for the three kids, the loan repayments we have for three loans, childcare, and what was left after that was what we could afford to pay monthly

Thanks for that. Thankfully we have no childcare costs as I work weekends and my parents take him one day per week.

Did having children affect the LTI for you, ie was it less than 3.5x your combined salaries?

ted1

catrionanic wrote: »

jlm29 wrote: »

ETA- they added our joint monthly incomes together, subtracted (I think) €1025 per adult, €750 for the three kids, the loan repayments we have for three loans, childcare, and what was left after that was what we could afford to pay monthly

Thanks for that. Thankfully we have no childcare costs as I work weekends and my parents take him one day per week.

Did having children affect the LTI for you, ie was it less than 3.5x your combined salaries?

Yes, significantly less

jlm29

catrionanic wrote: »

jlm29 wrote: »

ETA- they added our joint monthly incomes together, subtracted (I think) €1025 per adult, €750 for the three kids, the loan repayments we have for three loans, childcare, and what was left after that was what we could afford to pay monthly

Thanks for that. Thankfully we have no childcare costs as I work weekends and my parents take him one day per week.

Did having children affect the LTI for you, ie was it less than 3.5x your combined salaries?

We were only looking for a teeny tiny mortgage, a good bit less than 1x my salary- probably about 0.5 of our joint incomes. I would say the 3.5 is the max, and then they look at affordability, and reduce it accordingly if necessary? That’s how I understood it anyhow, but could be totally wrong there!

LirW

As far as I know they don't take parents as minders into account. At least on our application, even though there were arrangements in place, they were ignored. Some banks lower your amount depending on the age of the kids because they could face college costs etc.

Mortgage applications with children involved can be very chaotic and a lot of people get significantly less than they expected. That's why I suggested thinking about getting the ball rolling asap and maybe talking to a good broker who has experience with this.

ted1

LirW wrote: »

As far as I know they don't take parents as minders into account. At least on our application, even though there were arrangements in place, they were ignored. Some banks lower your amount depending on the age of the kids because they could face college costs etc.

Mortgage applications with children involved can be very chaotic and a lot of people get significantly less than they expected. That's why I suggested thinking about getting the ball rolling asap and maybe talking to a good broker who has experience with this.

They counted my wife as a dependant as she’s a stay at home wife/home keeper / what ever is the currrent PC word

annoyedgal

Due our second baby in nine weeks and just finished the process of buying and selling.
We put our house up for sale and began looking at the same time. began to bid as soon as our own place went sale agreed.
Moved out and moved into new place on the same day. Can't lie, was very stressful and we were anxious to have all sorted before new arrival for the financial reasons outlined in previous posts.
It's tough moving in 3rd trimester but it's definitely doable so would probably be wise yo get the ball rolling now. Best of luck!

catrionanic

annoyedgal wrote: »

Due our second baby in nine weeks and just finished the process of buying and selling.
We put our house up for sale and began looking at the same time. began to bid as soon as our own place went sale agreed.
Moved out and moved into new place on the same day. Can't lie, was very stressful and we were anxious to have all sorted before new arrival for the financial reasons outlined in previous posts.
It's tough moving in 3rd trimester but it's definitely doable so would probably be wise yo get the ball rolling now. Best of luck!

Thanks for the advice. How far along were you when you started the process? I’m almost 16 weeks now.

annoyedgal

House went up for sale when I was just a few weeks gone. 31 weeks by the time I moved in!
Was a 5 week hold up at the end that wasn't our fault and couldn't have been foreseen. That was the stressful part as we had no control over it. Thankfully we stayed in our old house until we moved so only had to pack and unpack once.
Bought and sold in Dublin so things moved pretty quickly and had a great solicitor who kept on top of everything and arranged to close both on same day.
It's so worth it now as have a garden and toy room plus few weeks to get set up before new arrival all going Well!
It was quite hard emotionally which I wasn't expecting! Must be the hormones! But so worth it now.
Your other option could be sell and rent for a year while you house hunt at your leisure. You'll be an attractive buyer as not in a chain.
Might be less pressure if there isn't properties in the area you want at the moment.
You'll likely be sale agreed in 4 weeks so you could be looking now and ready to bid in few weeks time.
Getting the house ready for viewings was a pain, if you do open house it's easier as can get a lot of people through at once.