How much can I borrow? Sales jobs with Commission

[colly]

I work in IT sales for one of the worlds largest and most reputable software companies. The nature of any of these jobs is that they are largely based on commission. Everyone in this type of role has the same - 50/50 split between your basic and your commission. You are never going to end up just making your basic - if you didn't make any sales you'd get fired. My baisic is 33k which with commission give me an OTE (On Target Earnings) is 66k - which is great, but I heard that banks will not recognise a large portion of your commission. I do understand why, because the nature of the business means that some months I earn no commission at all, and others my commission can be 3-4 times the amount of my basic.

Can anyone tell me how this works and what I am able to borrow? I do already have one small investment property which I hvae been renting out successfuly for about 3 years, and now I want to buy another one - possibly with a friend as a joint investment - cause I don't think the bank would lend me 330k on my own.

All comments appreciated.
Thanks

 

[Sarah W]

Lenders do recognise commission (and bonuses and overtime) but because it can not be guaranteed they will generally take 50% as evidenced by your payslips, P60 and salary certificate and add it to your basic giving you earnings of circa €50,000. That, along with room rental and assuming you have no loans will give you a borrowing capacity of around €250,000/€270,000 (I do't have a calculator to hand!) on your own. If there is a surplus of rental income over mortgage repayments (stress tested) on the investment property you may be able to borrow a little more.

Hope that helps.

Sarah

www.rea.ie