Please suggest whether I will get mortgage

john14

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I am working in medical field as a permanent position, my annual earning is 42k.
My partner is taking care of our kids full time, so unfortunately we have only one earning. We are planning to buy a house at price we would be happy around 180k.

We don't owes have any credit balance, and any loan, all settled out recently.

We have a saving of 6k only, and have a gift of about 55k. we both are 37 & 34 years

Any suggestion would be greatly appreciated
 
The banks like to see a good record of consistent savings. With this in mind, you should have at least 6 months bank statements showing a good amount of monthly savings.

You're current available funds are €61,000. If you take €6,000 away for fees and initial costs, that leaves €55,000 for the deposit itself and leaves a requirement for a €125,000 mortgage on a €180,000 home.

A €125,000 mortgage at 6% over 30 years gives a repayment of €1,090 per month.

You mention kids but don't say how many. The banks requirements I hear mentioned a lot requires disposable income, after mortgage payments, of €2,000 for a couple and €250 per child. Assuming 2 children, this leaves a requirement of €2,500 disposable income plus €1,090 for the mortgage - giving a €3,590 requirement for household income.

I make a €42,000 salary out to be €2,880 per month (for a married couple on a single income) so I'm afraid I don't hold much hope for you. Try using the link below to come up with an estimated amount that AIB would lend.

In playing around with Irish salary calculators, I'd estimate that a married couple with two children looking for a mortgage of €125,000 would need a household income of approximately €60,000.


https://mortgage.aib.ie/
 
I'd estimate that a married couple with two children looking for a mortgage of €125,000 would need a household income of approximately €60,000.https://mortgage.aib.ie/

Good post Ronaldo. And the public are asking if the current state of the market is a 'Bubble' ?

Personally my belief would be, taking into account of the OPs circumstances, I think they might be best to continue renting, rather than tie themselves with a loan from Banks that are unwilling toi support the Public, those that bailed them out of their own and the other banks' mistakes.
 
OP, my situation might be relevant to your own somewhat.

I earn 42,750, my OH has only started a new job so her income didn't count towards the application.

We had a gift of €80,000 and no savings. We had monthly rent payments of €730 per week to show repayment ability.

We were approved for €80,000 (the max we could get) with AIB. The limiting factor here is definitely my take-home pay, which is €2,550 per month.

EBS have said we could qualify for €100K so we are in the process of applying there too.

As I said we had none of our own savings, but were only looking for 50% of the purchase price and had rental payments to prove repayment capacity.
 
john14, you have just cleared down all your loans and are building up your savings, I think it would be worthwhile building more savings first, you would be in a stronger situation then.
 
John,

If you PM me I could send on the details of a man to talk too. The other posters are both correct but if as so-crates said you increase your savings on a regular basis I think by year end you could be in good shape, plus this time will give you room to think through the exact house you want.
 
AIB lends only up to age 65. BOI and some others lend up to age 70. So this can increase the amount you can get as you have longer to pay it back.
We have one income of 43k. We got offered 80k from AIB (having first been told it'd be higher). Then we were offered 100k with BOI - we only took 80k in the end. We had a large deposit which was half the purchase price.
BOI don't add an amount of disposable income for kids, but AIB do. That's why AIB looks 'stricter' than BOI.
Last time I heard it was €1750 per month disposable that BOI were looking for. That could have changed since.
From what I know they are more interested in ability to repay an amount rather than how much savings you have.
 
AIB lends only up to age 65. BOI and some others lend up to age 70. So this can increase the amount you can get as you have longer to pay it back.
.


40 year mortgages are not a good idea. In my opinion. I also think they distort the market.
 
its a great information to me thanks!! i need to start saving seriously, moreover just to add that on average we have a income in hand monthly as € 3000, out of I am paying a monthly house rent as €1100. have two kids 7/8 years old... hopefully i will be have our own house in dublin before 2015...haaa.hhaa
 
I agree 100% that 40yr mortgages are not a good idea.
In my circumstances example I gave we were both in our 40's so our term is just over 25yrs. Our mortage is €450 or so a month for the 80k over that term (16%). That might seem 'small' to some people. However...
With 2800 take home pay per month we spend every cent, only saving a portion of the children's allowance. Thankfully we have other savings and some inheritance money that we dip into for holidays and health insurance. We just keep our old cars going, if we needed a new car savings would have to pay for that. Even with the mortgage being less than 20% of income there is no room for other loans of other kinds. The kids do drama, swimming and music classes which have to be paid for. We only have the basic TV package and don't go out much. Christmas used to be paid for by getting tax back - mostly from the rent relief tax credit which will go now that we have our own house. And I think the rent relief tax credit is gone if you started renting after 2010.
If we didn't have the other savings, we'd be going slightly overdrawn every month and gradually creeping up the credit card bills by being less and less able to clear them.
Anyone thinking of a mortgage should have a detailed spreadsheet of their monthly expenses, to include fuel bills, kids activities now and the future, holiday and car expenses etc. Then you'll see what repayments you can afford.
 
I don't really agree with the idea of a 40-year mortgage, in itself, being bad. A 25-year term, in my opinion, is just an arbitrary number with no real meaning or justification behind it (obviously, you'll pay the mortgage off earlier but there's no real need to have it paid off over that precise term).

The main thing when it comes to mortgages is that it is paid off before retirement. With that in mind, I see no problem with a person in their early 20's taking a mortgage with a 40-year term. The mortgage will still be paid off before retirement and cashflow will be much better during the years during which the average person would be raising children.

The problem, however, is when these 40-year mortgages result in an increase in property prices beyond what they would be had such mortgages not been available. Obviously, in recent times, we've been in a bearish market and the affect of this is limited. However, in a normal market, the impact of such mortgages would be more significant.

However, with all of the above in mind, and assuming the person has decided upon their budget, I see no problem in choosing a 40-year term over a 30 or 25-year term.
 
My family is single-income and many kids but UB were happy to offer me a mortgage (albeit 18 months ago) when most other banks were not. I had no prior dealings with UB. They allowed a sizable portion of the Child Benefit as income when calculating how much they'd lend. They were only after 3 months accounts. I'd aim borrow over the longest period possible but pay back over a shorter period.
 
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