# €28k salary; 2 kids - will I get a mortgage?



## Chris2014 (9 Jun 2016)

Ive just graduated from college and started a job on 28k. I have 2 young kids and my partner has just herself started college for 4 years. I live in Waterford where a decent house can be had for 100k. A fixer upper for about 80k.

Have i any chance of getting a mortgage by myself in about a years time. I have a deposit saved and sitting in the credit union the last few years. I have 0 debts and no credit problems.


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## PGF2016 (9 Jun 2016)

Not enough information in your post to judge. You would need to show the lender that you have the ability to make stress tested repayments.


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## Chris2014 (9 Jun 2016)

How would a person generally do that? 

Any other way apart from saving as much as possible over the next year? I already have a deposit put aside. 

I worked while in college and saved that.


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## dereko1969 (9 Jun 2016)

What rent are you paying at the moment? If your mortgage repayments would be similar to your rent then that would help the banks determine that you can afford to repay the mortgage. Why are you looking for a mortgage on your own though? You can't leave out the fact that you have children as that will go to affordability.


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## Monbretia (9 Jun 2016)

The bank will have it's own affordability table, in other words there will be a certain amount of money you will need to have leftover every month after paying all repayments from your net salary.  This will determine your eligibility, it differs depending whether you are single or have dependants.  I don't know what it is these days, some of the bankers here might know.


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## Boyd (9 Jun 2016)

OP, in order to get any way reasonable answer, you need to include far more details, at least the following:


Salary (28K we already know)
What deposit amount you have saved
Your current rent
How much you can afford to repay per month compared to rent
How much you are saving per month after bills
Any other loans or expenses (childcare etc)

You also need to think about the relationship with your partner. How are they going to feel living (I assume) in your house. Will they contribute rent etc? Lots to ponder besides getting mortgage approval in this situation (having a child and non-married partner)


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## Chris2014 (10 Jun 2016)

Salary (28K we already know)
What deposit amount you have saved (I have about 7k now but would come up with another few k easily enough. Hoping for ~100k so i assume 10k is enough)
Your current rent (650 - Mortgage would be 379 per month on 100k from the BOI online calculator.)
How much you can afford to repay per month compared to rent (I can easily afford the 650 rent so id imagine that or  more if required.)
How much you are saving per month after bills (While in 3rd year of college i got paid work experience. Saved literally every cent. Thats how i have the deposit. I will start saving again in 2 weeks when i get my first pay. Not sure how much. 200 a month for now maybe.)
Any other loans or expenses (None at all. I cleared all loans years ago and havent borrowed since.)
Also about the partner relationship. We are together 12 years and have 2 young kids. We are not married because we are not religious in any way.

The situation we are in is we where both made redundant 5 years ago. I went to college, she raised our kids. Now im finished college its time for her to go back. Im a Software Engineer so i knew i would be on livable money when i graduated so she could afford to go back. She will be a nurse. Its her turn now basically.

Some questions also

1 - Is there any hard rules that says i cant get a mortgage or is it just a matter of proving that i can pay it back?
2 - Would a bank ever think that someone has potential to earn in the future? As a Software Engineer Graduate my salary is very likely to double in the next 4 years. In my company they give 55k to engineers with 4-5 years experience and i dont see why i cant work towards that role. Also my Partner will likely be on at least 20 - 25k in 4 years but nothing until then.
3 - Does having 2 kids heavily affect your chances of approval? I would have thought it would add more security to the relationship etc.. rather than being a disadvantage but maybe not.


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## Chris2014 (10 Jun 2016)

dereko1969 said:


> Why are you looking for a mortgage on your own though? You can't leave out the fact that you have children as that will go to affordability.



I just answered that in previous answer in more detail but basically Partner is starting 4 years of college. Shes not employed so it would have to be on my own. We are both 30 so i cant wait around if at all possible paying 650 a month rent when ideally it would be paying a mortgage.


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## Steven Barrett (10 Jun 2016)

It is unlikely that you would get a mortgage on that salary. The reason being that banks have requirements that you have a minimum level of disposable income after paying your debts. On your income, you bring home about €1,970 a month. With 2 kids, you will need to have a disposable income of c. €2,500 a month after the mortgage being paid. 

On your other points, future earning potential is only potential and not actual earnings. It is too open to fanciful projections.

Having kids makes it harder to get a mortgage as creche fees count against you and the minimum disposable income requirement is higher. 

Keep doing what you are doing though. When your earnings increase, you will be in a better position. 

...oh, on the marriage thing, it has nothing to do with religion. There are a lot of practical benefits to being married. You can use your partners tax credits while she's not working. Ireland still treats co-habiting couples like strangers which can cause issues if there is a premature death and widow's pension is means tested as opposed to being an entitlement. You can always go to a registry office. 

Best of luck

Steven
www.bluewaterfp.ie


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## PGF2016 (10 Jun 2016)

Chris2014 said:


> 1 - Is there any hard rules that says i cant get a mortgage or is it just a matter of proving that i can pay it back?
> 2 - Would a bank ever think that someone has potential to earn in the future? As a Software Engineer Graduate my salary is very likely to double in the next 4 years. In my company they give 55k to engineers with 4-5 years experience and i dont see why i cant work towards that role. Also my Partner will likely be on at least 20 - 25k in 4 years but nothing until then.
> 3 - Does having 2 kids heavily affect your chances of approval? I would have thought it would add more security to the relationship etc.. rather than being a disadvantage but maybe not.


1 - Just a matter of proving you can pay it back. Plenty of people with kids and mortgages. ☺

2- Depends on the job. Best to ask the bank. 

3 - I would think the bank is only interested in the ability to repay the loan. Kids are seen as an expense like a car loan would be.

I don't work in a bank so these are my thoughts as opposed to facts.


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## trasneoir (10 Jun 2016)

Well done, it sounds like you're playing a blinder.

I'd be tempted to wait if I were in your shoes. You don't need to take the risk of rushing into an obligation that's only affordable _if everything else goes well_.

Fast forward five years - you've got the experience you need earn an extra 25k (easily), and your partner is settled into work (say 25k to be conservative). _If _you hang onto your superpower of not buying stuff you don't need (your kids will thank you when they're older), you'll have ~2.5k of surplus income each month. You can own any house in your area in no time.

Until you get there, your biggest asset is flexibility:

You can move to suit your careers, 
You don't need to worry about big unexpected homeowner's expenses (boilers etc) 
Your savings amount to a proper emergency fund, to let you handle any snags with career/college/health/kids without undue stress


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## michaelm (10 Jun 2016)

Chris2014 said:


> Also about the partner relationship. We are together 12 years and have 2 young kids. We are not married because we are not religious in any way.


Nothing religious about civil marriage and that would 'add more security to the relationship', as you put it, for all.





Chris2014 said:


> Does having 2 kids heavily affect your chances of approval? I would have thought it would add more security to the relationship etc.. rather than being a disadvantage but maybe not.


The kids make make getting a mortgage trappy and  trasneoir's post makes a lot of sense.  UB might be your best chance of approval for joint applicants with two dependants but I wouldn't over complicate an application with back to education talk; rather, partner is a stay-at-home parent so childcare costs are not an issue.

I guess that if you were a sole applicant with a permanent job, a savings record, rent paid by DD, and no dependants you potentially could wangle a mortgage of up to 98k (28k x 3.5) on a house costing 108k.  I'm not suggesting that one should conceal anything but I can't say that I wouldn't do so if in a similar bind.


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## Chris2014 (10 Jun 2016)

Ill try cover everything rather than quote everyone.

With the marriage its really strange. We have zero interest in it and dont see the point right now. Ive just been through 4 yrs of college with 2 young kids born in tbat time. Some kind of ceremony is honestly the last thing on our minds. I would feel a bit dishonest getting married just for tax benefits or anything like that. Surely many young couples are thinking the same way these days. Ive thought about it so little that i wouldn't know anything about that side of it or the potential financial benefits. Always just thought of it as a huge expense.

Kids. Yeah that makes sense alright about them being an expense. Even though we have no childcare expenses as the partner is only going to college now in Sept and grandparents will be taking the kids for a couple of days a week. College is across the road from grandparents and course is 3 full days rather then being spread out over 5 days. Works out nicely and save a few quid. They said they will take nothing for now if it works against me for a mortgage.

Overall i really thought a bank would be pleased to hear that i dont want to spend another 25k on rent over the next 4 years on a 100k house when i have a deposit there and what i would think is a good job.  This is in Waterford where houses are relatively cheap. When i graduated i had 5 job offers in 2 weeks in a county with horrible levels of unemployment. I feel like my job would be very secure and a profession where i could pick up work easily enough if need be. 

trasneoir. Fast forwarding 5 years. I just felt like im getting old now and the time is right. Were 31 with 2 kids and im paying rent since im 17. Ive been to college twice. No interest whatsoever with travelling or anything like that. Sounds like the easiest thing in the world to do is just wait for 4 years and we will be in a far better situation but its painful handing out 650 a month when a mortgage on this house now is less than 400 a month and i have a deposit and job. Might have to get myself a new hobby to pass the time!


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## PaddyW (10 Jun 2016)

Unfortunately, when it comes to banks it really boils down to cold, hard numbers. If the figures don't add up, computer says no.

Trasneoir's advice is the most solid advice you can get really.


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## AlEl16 (18 Jun 2016)

I hate bringing negativity now but as some others said it's unlikely at the mo!I've just recently went through the process and the points I got from it have to have a permanent job, 2 kids = 2500 left after mortgage payment, they are some of the basics. I only got a mortgage as husband secured a part time job when I went to apply with just me working and 2 kids on 35000 they said not a hope!!But look every case/bank can be different so I'd speak to a bank anyway.


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## Tarnhows (18 Jun 2016)

Can't understand why you'd have children before getting a mortgage


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## PaddyBloggit (18 Jun 2016)

Tarnhows said:


> Can't understand why you'd have children before getting a mortgage



It's called life .... life doesn't just revolve around mortgages.

Regardless, your contribution doesn't help answer the OP's query.

Trasneoir's advice is one worth following.


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## Monbretia (18 Jun 2016)

Because life happens


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## Steven Barrett (18 Jun 2016)

Tarnhows said:


> Can't understand why you'd have children before getting a mortgage



Life doesn't go in a straight line. There are a lot of surprises along the way.


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## Easeler (18 Jun 2016)

Tarnhows said:


> Can't understand why you'd have children before getting a mortgage


Hope you have all your ducks in a row, if people wait till everything is in order and can afford kids they would be very few kids born. OP you have done well to go to college and have kids and get s job and OH going to college its pretty mad, would you not qualify for a coucil loan these are not to be snubed at and might be an option, banks are not great at the moment for people on low incomes


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## Chris2014 (19 Jun 2016)

Tarnhows said:


> Can't understand why you'd have children before getting a mortgage



I assumed they thought that kind of stuff in every primary school.

Also for everyone else another question.

Where would be the best place to continue saving? Ill be saving about 650 a month. Should i just build up the credit union account or transfer it all into a bank savings account?

If i was to apply for a mortgage in a few years would it make a difference where the money was saved once i can show proof or is it beneficial to for example have an UlsterBank savings account and apply to Ulsterbank for a mortgage?


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## PaddyBloggit (19 Jun 2016)

It doesn't matter where your savings are once you can show a paper trail of regular savings.


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## Chris2014 (19 Jun 2016)

PaddyBloggit said:


> It doesn't matter where your savings are once you can show a paper trail of regular savings.



Thats good. Thanks for the info Paddy.


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## 44brendan (20 Jun 2016)

Chris2014 said:


> Ive just graduated from college and started a job on 28k. I have 2 young kids and my partner has just herself started college for 4 years. I live in Waterford where a decent house can be had for 100k. A fixer upper for about 80k.


You are somewhat unfortunate in that you fall into the category of being a low earner who appears to have an excellent grasp of cash management. Your best option at this time is to plan for an interim review of your situation in 2 years and a full review in 4 years. I.e. Your own income may increase over the next 2 years to a point where you can successfully apply for a mortgage using this alone. However with 2 children you may wish to wait for a time when you can buy the property you want/need rather than the property you can afford. With 2 incomes available in 4 years time plus accumulated savings you could be in a better position to purchase a better quality property. banks are somewhat averse to granting mortgages on "fixer uppers". If the property needs work done the mortgage proposal will need to account for available funds to complete these works. Stating that you will do this yourself over time will not be generally acceptable!


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