FTB: have mortgage approval in principle for €232,000, in DCC shared ownership scheme

Sinbad311

Registered User
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Hi,

I have just received mortgage approval in principle for 232000.

I have seen a few few houses that I would be interested in. Some are within budget and a couple are around €250,000- €265,000. My question is, does anybody think that the properties from €250,000-€265,000 are within my reach or am I dreaming!

I am going through Shared ownership with DCC so I have no deposit.

I have a few quid saved but would like to hold onto that for furniture decorating etc..

Any feedback greatly appreciated.

Simon
 
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Re: First time Buyer

Hi,

I have just received mortgage approval in principle for 232000. I have seen a few few houses that I would be interested in. Some are within budget and a couple are around 250000- 265000. My question is, does anybody think that the properties from 250000-265000 are within my reach or am I dreaming!!

Simon

How many time salary is 232k btw?

Depending on the above you are probably dreaming unless you save for the difference. U have been approved for 232k what would make the bank give you more?

Unless yr income improves or any other debt you have reduces i don't see how you are going to get to 260K.
 
Re: First time Buyer

Mr. DT

€232,000 is roughly 7 times salary. I'm not actually looking to raise the extra money to buy this house.

My previous question was asking whether or not I would be able to negotiate a price drop from €250,000 to €232,000?

I know it depends on a number of things but am I being unrealistic in regards to vendor dropping €18k.

Simon
 
Re: First time Buyer

Mr. DT

232000 is roughly 7 times salary. I'm not actually looking to raise the extra money to buy this house..
..........but am I being unrealistic in regards to vendor dropping 18k.

Simon

Yes i would say you have a very good chance of acheiving this discount. To be honest though 7 time salary is massive! Which to me indicates the property is way over valued or would suit some one on a higher salary.

I my opinion, you would be mad to borrow 7x your salary!!! Mad.
 
Re: First time Buyer

This loan is with the DCC. Its the amount they think I can repay. I am currently renting the last 2 years and have been paying 950 p/m until 2 months ago when the landlord dropped to 850 p/m. I have easily paid rent so repaying mortgage on 232000 doesn't worry me.

The DCC approved me for 232k and now leave it up to me to find house and agree on price. When I agree price I let DCC know and they takeover from there.

So all in all I wanted to know whether 232k could buy get me a house worth 250k-260k with some negotiating.

Thanks DT

Simon
 
Re: First time Buyer

This loan is with the DCC. Its the amount they think I can repay. I am currently renting the last 2 years and have been paying 950 p/m until 2 months ago when the landlord dropped to 850 p/m. I have easily paid rent so repaying mortgage on 232000 doesnt worry me.
The DCC approved me for 232k and now leave it up to me to find house and agree on price. When I agree price I let DCC know and they takeover from there.
So all in all I wanted to know whether 232k could buy get me a house woth 250k-260k with some negotiating.

Thanks DT

Simon

You wont get if you dont ask.

I would bid €210k (to reduce any sellors expectations) on a house looking for €250k. Say you have loan approval and that you are not waiting to sell. The buyers hold all the cards at the moment, particularly if you are looking at houses in places were there are many for sale. You could always try to bid them down to nearer your asking price.

I would advise that you work out the mortgage repayments if the interest rates were to rise back to 5% (just as a barometer). Its a good way of stress testing how you will do WHEN the rates go up.
 
Re: First time Buyer

I agree with Northdrum that you should just make sure that you can afford the repayments when the rates go up again. That's far more important than saying "I'm borrowing X times my salary so that's good/bad". It's all about affordability- if you can afford the payments at the higher rates then technically you don't have anything else to worry about provided you always have your job.

best of luck!
 
Re: First time Buyer

Yes you can definitely negotiate that far. I have personal experience of this from a seller's perspective.
 
Re: First time Buyer

"I'm borrowing X times my salary so that's good/bad". It's all about affordability- if you can afford the payments at the higher rates then technically you don't have anything else to worry about provided you always have your job.

best of luck!

Of course, but this descion is taken out of your hands because its the bank/lender who decided what is affordable/how many times income you can borrow. You might think its affordable but they might not.

I would see banks are only going to/ are getting tight on this, especially as unemployment hits 15%+ and taxes go up.
 
Re: First time Buyer

Is it the Council taht is lending you this money as part of the shared ownership scheme?
What rate are you getting on the mortgage?
Also - I thought yoouhad to have a minimum deposit of 3k with Dublin City Council for shared ownership ?
 
Re: First time Buyer

Is it the Council taht is lending you this money as part of the shared ownership scheme?
What rate are you getting on the mortgage?
Also - I thought yoouhad to have a minimum deposit of 3k with Dublin City Council for shared ownership ?

It is the council that is lending the money. And yes you do need a deposit of 3k. Not sure on mortgage rate but as far as I know they go with ECB rate
 
Re: First time Buyer

Thanks NorthDrum,

Thats exactly the answer I was hoping for.

Simon

Your welcome, good luck and remember there are plenty of houses out there for you to bid on, you are in the power position, dont let them convince you that you are out of order making a lower bid (that is your right), you are entitled to bid whatever you want. The worst they can say is no . .
 
Re: First time Buyer

I just think it's a bit strange that the Council will lend 7 times Salary .
You say you will be able to cope with the repayments - how much a month will they be?
I'm not being nosey - just concerned that maybe you will be taking on a large loan on a property that may well go down in value .
 
Re: First time Buyer

I just think it's a bit strange that the Council will lend 7 times Salary .
You say you will be able to cope with the repayments - how much a month will they be?
I'm not being nosey - just concerned that maybe you will be taking on a large loan on a property that may well go down in value .

I know of one system used is whereby the councel pays for half the purchase price and you pay for the other half. You pay your own half like a mortgage and you just pay the interest owing on the part of the councels side.
 
Re: First time Buyer

@NotrhDrum - thats pretty much what the shared oqnwership is. I pay mortgage on the percentage I own and I oay rent on the percentage that the DCC own. Minimum I can own is 40%. Obviously the bigger % I own the better, as it would be more money being paid off my mortgage. After a year or two I hope to get proper mortgage from bank and buy house outright.
Basically its a handy way of getting a mortgage for people that have no deposit or have been refused from bank or the bank wont lend you enough.

Simon
 
Re: First time Buyer

@NotrhDrum - thats pretty much what the shared oqnwership is. I pay mortgage on the percentage I own and I oay rent on the percentage that the DCC own. Minimum I can own is 40%. Obviously the bigger % I own the better, as it would be more money being paid off my mortgage. After a year or two I hope to get proper mortgage from bank and buy house outright.
Basically its a handy way of getting a mortgage for people that have no deposit or have been refused from bank or the bank wont lend you enough.

Simon

Yeh, I assume this is similar deal to what the OP is getting . . (I could be wrong, I was wrong once before ;) ).
 
Re: FTB: have mortgage approval in principle for €232,000, in DCC shared ownership sc

Hi Sinbad i am going through the Shared Ownership myself at the minute with Dublin City Council. I got approved for 265,000. I found a three bedroomed house that i love priced at 240,000 and managed to get the sellers down to 210,000 and sent in the details to DCC at the beginning of April. I recieved a letter in the post last week to say it was my final approval and that their surveyor etc had been out to see the house and was happy with it and passed it etc. Was on the phone to DCC yesterday and they said the sale will be closing in 4-6weeks, they said it looks more likely 4 weeks as everything is quiet at the moment. In their letter they also told me my repayments will be 897euro a month - 560ish mortgage, 330ish rental part. Im delighted with this as I am currently renting a one bed for 850euro per month so for the extra 47euro i will have a place of my own and it is a three bed. So far my dealings with the Shared ownership have been great and I cant wait to move in :) What council are you going through? If I can offer you any more information just ask

Ericsson :)
 
Re: FTB: have mortgage approval in principle for €232,000, in DCC shared ownership sc

Why are you buying a house right now? If you wait 12 months you'll get it at €50k cheaper.
 
Re: FTB: have mortgage approval in principle for €232,000, in DCC shared ownership sc

Why are you buying a house right now? If you wait 12 months you'll get it at €50k cheaper.

Not a guarantee, but it is a decent bet that they might get it cheaper in 12 months alright.

Thing is by then will they get a mortgage, the way the landscape of mortgage applicants has changed so dramatically so quickly, this is something to consider.

Its not easy for anybody buying a house at the moment when trying to predict when the market will bottom out. Nobody can say WITH CERTAINTY that prices will continue to fall rapidly or steadily slow down.

If you desperatley want to move and you are confident that this house will be one you will be living in for a long long time, then what it will be worth next year is not as important as stress testing your ability to repay the mortgage in the event of an interest rate hike.

Either way, make sure you have bartered a good deal (try to get at least 10% knocked off the asking price).
 
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