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Lower Mortgage Amount for Do Er Upper?

  • 09-06-2024 3:27pm
    #1
    DonnieCorko
    Registered Users Posts: 256 ✭✭


    Hi,

    I am looking for some clarification on this.

    If I have mortgage approval for 400K and a deposit of 50k, I can purchase a house for 450k.

    However, if I want to purchase a do-er upper that is on the market for 370k, I will need roughly a 40k deposit. Therefore, the mortgage amount is 330k, which means by total purchasing power is 330k+40k deposit+10k remainder. Is that correct?

    Or can I still get a 400k mortgage?

    Thanks



Comments

  • #2
    Buddy Bubs
    Registered Users, Registered Users 2 Posts: 3,958 ✭✭✭Buddy Bubs


    If the house is on the market for 370k you can't get a 400k mortgage. Max is 90% for first time buyers. 400k would be like 110% or thereabouts. 330k sounds right there.

    Is that what you're asking?

    Or are you asking if a bank will lend less on a house that needs work ?

    And what is the 10k in your 330+40+10? I don't know where that 10 appeared from



  • #3
    extra-ordinary_
    Registered Users, Registered Users 2 Posts: 1,734 ✭✭✭extra-ordinary_


    https://www.boards.ie/discussion/comment/122238368#Comment_122238368

    10k/13k is left out of OPs 50k savings after paying 37k deposit on a 370k house. Yes, I think you can keep that 13k for doing the work on the house, although whoever is giving you the mortgage will confirm.

    You won't get a 400k mortgage for a house valued at 370k as already said 90% of purchase price mortgage is most you can apply for.



  • #4
    mulbot
    Registered Users, Registered Users 2 Posts: 1,912 ✭✭✭mulbot


    You'll only need the 37k,the rest of your savings are irrelevant, unless you want to put 50 grand down and take slightly smaller mortgage.



  • #5
    DonnieCorko
    Registered Users Posts: 256 ✭✭DonnieCorko


    https://www.boards.ie/discussion/comment/122238368#Comment_122238368

    As the poster said below, the 10/13k is the remainder.

    I thought you could get a mortgage though that included funds for renovations? Is that not the case?



  • #6
    DonnieCorko
    Registered Users Posts: 256 ✭✭DonnieCorko


    From what I read elsewhere, you can borrow 90% of the house, and 90% of the renovations (presumably up to your max mortgage amount - in my case 400k).

    If so, I could borrow 343k for the house (+37k of my deposit = 370k - the base house cost), plus another 57k (343k house borrowings + 57k renovation borrowings = my 400k max loan amount allowed).

    Is this correct?



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  • #7
    extra-ordinary_
    Registered Users, Registered Users 2 Posts: 1,734 ✭✭✭extra-ordinary_


    https://www.boards.ie/discussion/comment/122239431#Comment_122239431

    From what I read elsewhere, you can borrow 90% of the house, and 90% of the renovations (presumably up to your max mortgage amount - in my case 400k).

    Have you a link? The bank are gong to lend you more than the asset is currently worth? Where is their security?



  • #8
    DonnieCorko
    Registered Users Posts: 256 ✭✭DonnieCorko


    https://www.boards.ie/discussion/comment/122239541#Comment_122239541

    https://mortgage123.ie/house-renovations/

    House must be worth extra equivalent to the borrowings.



  • #9
    extra-ordinary_
    Registered Users, Registered Users 2 Posts: 1,734 ✭✭✭extra-ordinary_


    https://www.boards.ie/discussion/comment/122239624#Comment_122239624

    Ah yes, OK. The lender will lend you 90% of the asset and once you increase the value of the asset through renovations etc they will re-evaluate the asset and offer you 90% of the difference in the two values. So for your 370k house purchase, you'll have 13k to renovate.



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