Mortgage application; 1 income, family of 4

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rolly123

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Hi everyone, just wondering can anyone give some advice on our situation.

We have 2 kids and my partner is staying at home minding them. My salary is 44k (including overtime and bonuses). We had a meeting with our bank (aib) and they said that we fall short of the net disposable income for a family of 4. Their affordability rate is €250 per dependent. Does anyone know what other banks stance is on this, are any lower?

They said they only take into account 50% of overtime (even tho I get a guaranteed 10 hours every week and most weeks more). So the adivice they had when leaving was to basically increase my income or for my partner to get a job. A part time job at 18k a year. Obviously then childcare costs would work against us.

Is there any bank that will give us a mortgage and should we consider a broker? Thanks in advance for any advice!
 
What's your guaranteed salary?

Unfortunately the rules around income are fairly standard. The banks will allow for 50% of overtime (average over last 3 months), but not bonus unless it's guaranteed. They are fully allowed to meet CBI criteria, so it's just the banks own underwriting rules.

I'm not sure if it will help you, but UB allow children's allowance to count as an additional income. It might be worth a conversation with them or a broker.
 
Guaranteed salary is 30k and I've been getting 14k in overtime since I started, so 7k of that is considered.

Oh that's good to know for UB. I was thinking of ringing them to arrange a chat.

Do you know anything about the affordability rate? Aib is €250 a month per dependent but they did tell us that every bank has a different number for this. I was quite shocked by this number!
 
250 is probably standard, but each has a slightly different starting point.

To be honest, it's unlikely anyone will give you a mortgage on a salary of 30k. Have you looked at getting a change in your employment contract to increase your base salary?
 
Yeah I was thinking of talking to my employer about this. Tbh I'm not really sure why this is done. Maybe my employer is doing it for a tax reason! Our other option is to maybe try the council scheme.
 
No, there's no tax benefits. Just they can reduce everyone's hours to respond to reduced demand quickly - which is why the banks only count 50% of it.

Yes, the council scheme might be best option for you. Just remember you need to go through the formalities of applying to main banks and getting rejected first.
 
I recently went to KBC and AIB - I bank with the latter - re applying for mortgage. I found the whole process with AIB uncomfortable. we have combined income of 85K and additional in bonus/overtime and I was made feel like we earned nothing. we have considerable savings and equity in our home and was looking for about 200-250k. KBC on the other hand were very approachable and I just found them overall better to deal with.
 
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