First time buyer question.

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bkkvillan

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My wife and I are looking to apply for a loan. We have a joint income of 43k and a deposit of 15k. We are looking to apply to BOI, which I have been a member for over 14yrs and she 6yrs. We have a joint account and have been paying rent of between 800-700 a month for the last 4yrs. I have had numerous personal loans from them, all paid back without a missed payment, and one outstanding balance of approx 2k. i am looking to borrow 130k. I was wondering if anyone had an idea of would this be a favourable application, and if not, why?

Also, i was wondering how flexible BOI are on the deposit front?

Cheers,
Bkkvillan
 
Just apply for mortgage approval in principle and find out. No one can give you a definite yes or no but the bank themselves, and it won't cost you anything but time. Minimum of 8% of the purchase price will be required, so you should be fine.
 
Guide to calculation the max mortgage amount

1: Work out your net monthly wage amount
2: Subtract the Net Disposable Income required.
This is €1250 for a single person. €2000 for a couple. €250 add for each child.
[Note: some banks do have different figures but these have been reasonable accurate for both AIB and BOI]
3. Subtract out any loan or credit card payments.
4. Use a mortgage calculator to reverse the payments such as http://www.drcalculator.com/mortgage/ie/
To do this, tick the box beside the Principal line. Drag the years up to the desired mortgage term. [Note: BOI and AIB usually restrict mortgage terms to finish by the earliest retirement date if two people are applying]
Interest rates are stress tested at the current SVR + 2% or 6%, which ever is higher.


1. ~€2947 Net Income
2. €2947 - €2000 = €947
3. (Taking a wild guess at the repayments for the 2k outstanding) €947 - €100 = €847
4. Using €847 we get a total amount of €141 772
I have assumed a mortgage term of 30 years and the interest rate was 6%

Have a look at Preparing for a mortgage application too for some suggestions to get your finances in order. You'll need to show some savings in excess of your rent every month.
 
My wife and I are looking to apply for a loan. We have a joint income of 43k and a deposit of 15k. We are looking to apply to BOI, which I have been a member for over 14yrs and she 6yrs. We have a joint account and have been paying rent of between 800-700 a month for the last 4yrs. I have had numerous personal loans from them, all paid back without a missed payment, and one outstanding balance of approx 2k. i am looking to borrow 130k. I was wondering if anyone had an idea of would this be a favourable application, and if not, why?
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Is it correct that your deposit then is around 10%? If that's the case I'd advise to think carefully before you go through with it. The common mistake people make is thinking the reason for the deposit is for the banks benefit,to keep them happy. Actually it's in your interest to have as a high a deposit as possible! Something like a 40% deposit would be better. It protects you against price falls and any future problems such as losing a job etc..
If you look at the people who are in trouble mortgage-wise they are all those who had say <30% deposit.
 
Obviously it's better to have a higher deposit, but 40% is just not realistic for most FTBs. We had 20% & I thought that was really good. 130k is not a big mortgage - monthly repayments should be manageable, no matter what size the deposit.
 
A larger deposit also does little to protect against job loss. Having lower repayments helps but that is usually very separate to the deposit size. Most people are much better off keeping some of their cash in an emergency fund than dumping it all into a house as a deposit.
 
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