Will investing be held against you for a mortgage?

K

Khublei

Registered User
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Hello people,

I'm about to apply for a mortgage. In a long planning application, could be next summer before anything really happens. In the meantime I've been reading a lot about investing and today bought a few shares on Revolut. People in my work were shocked, said no bank would look at me if I the kind of person who spends my money on shares.

Is this true? I was considering trying a bit of Peer to Peer lending as well. But my investments will be very small. Just a little bit every time I get paid. I'd say max €500 of my money will be tied up in investments.

Will this be ok or do you think the banks now see me as risky? I've about €54k saved so €500 isn't a huge chunk.

Thanks
 
SBarrett said:
Banks don't like gamblers. There's a big difference between gambling and investing
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They have no problems with people gambling with their health. The box ticking underwriter will sign you off on a 20 a day smoking habit cost €320 per month but they'll frown at a tenner a week on the lotto costing €40 per month.
 
demoivre said:
They have no problems with people gambling with their health. The box ticking underwriter will sign you off on a 20 a day smoking habit cost €320 per month but they'll frown at a tenner a week on the lotto costing €40 per month.
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Not the same:
(1) - They have insured against the risk of you dying from smoking related illnesses.
(2) - While both are addictions, gambling is something that can get way out of control, with people stealing and running up massive credit card debt to feed their habit. There is a limit to how much you can smoke in a day. There is no limit to how much you can bet.
 
SBarrett said:
Not the same:
(1) - They have insured against the risk of you dying from smoking related illnesses.
(2) - While both are addictions, gambling is something that can get way out of control, with people stealing and running up massive credit card debt to feed their habit. There is a limit to how much you can smoke in a day. There is no limit to how much you can bet.
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1. Over 50s aren't required to have mortgage protection insurance.
2. Less than 1% of gamblers are problem gamblers.
BUT
3. This is Ireland.
 
PaddyBloggit said:
Does that mean I can stop mine (as I'm over 50)?
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I wouldn't. The post was about someone proving themselves right on the internet.

There's a legislative requirement in the Consumer Credit Act that a lender require you to have mortgage protection in place before you draw down a mortgage.
This legal requirement is not there if you're over 50 when you initially draw down the funds.
However:
1. Just because it's not a legal requirement doesn't mean a bank won't look for it, and
2. Why would you not want to have it in place? It's to pay off the mortgage if you die so your family aren't forced to sell the house.

The only reason that's it's not legally required is back in the 90's when it was written it was difficult or prohibitively expensive for someone in their 50s to get life cover. There's also an exemption if you can prove you can't get cover which has been discussed here previously.
 
Before thread goes off on a complete tangent, OP you are fine investing as long as they can see you can cover the monthly mortgage payment plus stress test. Don't listen to watercooler experts!
 
As an aside, you'll likely get a much better (and guaranteed tax free) return by overpaying your impending mortgage than investing in a post tax vehicle.
 
username123 said:
As an aside, you'll likely get a much better (and guaranteed tax free) return by overpaying your impending mortgage than investing in a post tax vehicle.
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The return may be guaranteed, but probably not better than equities over the long term.
It will be approx 2.5%
 
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