Maximum % Of Disposable Income Allowed By Banks As Mortgage Payment

[cruchan09]

Obviously when applying for a mortgage the maximum you can borrow is generally is a multiple of your salary but I know that the banks take into account car loans and other commitments when assessing your ability to repay. What generally is the maximum percentage of your take home salary banks will normally allow you to use to repay a mortgage and / or other debts when assessing your ability to repay. I have heard that 40% was the max but surely the higher your salary the less strict they are about this.

Man thanks for any advice.

 

[Hel_n]

Obviously when applying for a mortgage the maximum you can borrow is generally is a multiple of your salary

That isn't the case, very few lenders use this criteria any more. The amount you can borrow is now based on a percentage of your net disposable income (NDI) - your take home salary less any financial commitments. The percentage allowable depends on the lender, level of salary and LTV. Generally it can be anything from 35% - 50% and even more for certain professions.

 

[cruchan09]

Thanks for that Hel_n.

Does anybody know who is the least conservative bank in this regard and which bank if any take a more lenient view of public sector workers on defined payscales.

 

[Lipstick69]

There used be a view that ICS was the best place for civil/public servants. But in the public sector organisation I work in lots of people recommend Permanent TSB.

Public sector status worked as an advantage for me. I'm on a fixed term contract (off payscale) and when I gave the name of my employer they just assumed I was permanent and on a payscale and hence only asked for my last payslip and not proof of employment. This was Bank of Ireland (although it appeared on my credit bureau report as ICS)

 

[cruchan09]

Thanks!