Have I ever a hope of getting a mortgage?

M

Mel84

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I'm nearly 36, single, 1 dependant, a full time civil servant currently on €27,500 per annum, the only debt I have is my car loan and my credit rating the last 4+ years should be "perfect", I also get WFP, child benefit and maintenance. I am currently saving €300 a month but this only started recently. Can anyone tell me am I wasting my time saving for a deposit or is there a chance I'll manage to get a mortgage in a couple of years?
 
All depends on the size of the mortgage you're looking for. The 3.5 LTI rule would set your max borrowing at €96k. Ongoing finance for the likes of car loans will reduce that. If your income increases in the next few years and you have a good history of savings and no loans, you may get more.

Saving is a good habit, and the best time to start is always now. A multi-year plan incorporating your outgoings and savings should give you an idea of where you'll be in a few years. It's then a matter of looking at the location and type of property that will be both suitable and affordable.
 
It will be very hard for you to get one as your salary is too low. You would only be able to borrow approx 80,000 and and unless you want to live in tumble down house out in the sticks. It would really be impossible for you.
 
I think a civil servant would be a good candidate for an exemption from the 3.5 loan-to-income restriction but I suspect you would struggle to raise a mortgage of much more than €100k on the basis of your current salary.

Is there any possibility of a promotion over the coming years? Alternatively, could you get a second job to boost your income?
 
Your best bet might be a Rebuilding Ireland Home Loan. This is a scheme designed for people on incomes below €50000. It's administered by the local authorities. You can borrow up to 90% of the purchase price to a maximum of five times your income. Interest rates are 2.99% fixed for 30 years or 2.75% fixed for 25 years.

In your case, you could buy a place for €152k, with a loan of €137k and a deposit of €15k. (Figures rounded.) Those figures will go up if you get a pay raise while saving up your deposit.

It's far better than anything on offer from the banks at the moment. My daughter used it and the process was relatively smooth if a little bureaucratic!

www.rebuildingirelandhomeloan.ie
 
Sarenco said:
Alternatively, could you get a second job to boost your income?
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Hardly feasible for a single person with a full-time job and a child

@Mel84 You are presumably at or near the first point of the CO scale if you are a full-time civil servant on 27.5k. Your salary will increase steadily with increments in coming years and indeed you may achieve promotion. This will put you in a better place in coming years to be granted a mortgage.
 
Saavy99 said:
OP has just started saving €300 a month it will take her several years alone to save the €15,000 for the deposit.
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OP said she hoped to get a mortgage in a couple of years. If she could up the savings to, say, €500pm she'd hit that deposit in two and a half years. That would also demonstrate an ability to repay the mortgage, which would be about (my estimate) €600pm. That's a realistic plan.
 
Baby boomer said:
That's a realistic plan.
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Agreed but it's all very tight. Age is also a relevant factor here as it effectively reduces the potential term of the mortgage, which would increase the monthly repayments.

However, if the OP could boost her savings to something like €600pm (and I appreciate that will be very challenging) then it certainly looks like a realistic plan. If she could get the €15k deposit together by 38, that leaves 27 years to her normal retirement date.
 
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Baby boomer said:
OP said she hoped to get a mortgage in a couple of years. If she could up the savings to, say, €500pm she'd hit that deposit in two and a half years. That would also demonstrate an ability to repay the mortgage, which would be about (my estimate) €600pm. That's a realistic plan.
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It's not just the deposit, which will be very hard to save for on such a small wage, there's the legal fees, another couple thousand, stamp duty and then furniture.
 
Saavy99 said:
It's not just the deposit, which will be very hard to save for on such a small wage, there's the legal fees, another couple thousand, stamp duty and then furniture.
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True.
Legal should come in at slightly under 2k.
Stamp duty is 1% so €1500.
Furniture, well the OP knows that better than we can speculate. She may already have furniture for than can be moved to a new place for all we know. If the OP can manage to save €500 to €600pm the extra costs will add maybe six months or so, but it's still doable.

Look, I never said it would be easy. But it is possible. I'm just trying to be helpful and answer the query. The OP is attempting to do something sensible and prudent and should be encouraged in this.
 
Yes is the answer - but the post does not say where the lady wishes to purchase. I’m thinking of any town in rural ireland - where 100k will get her a standard 3 bedroom semi. A clerical officer can work in civil service, hse, local authorities, etb, etc - so even if you don’t work in rural location one could move and achieve all her dreams
 
cmalone said:
Yes is the answer - but the post does not say where the lady wishes to purchase. I’m thinking of any town in rural ireland - where 100k will get her a standard 3 bedroom semi. A clerical officer can work in civil service, hse, local authorities, etb, etc - so even if you don’t work in rural location one could move and achieve all her dreams
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I don't think 100k would get you a standard semi in any rural town.
 
Cavan/ Carlow / Laois / Leitrim / Longford / Offaly... etc . and further away from cities - and even better value coming post covid ...
 
The RIHL is great for single applicants, it allows up to 5 times your salary but they are also very strict on savings. You must have a 10% deposit with 7% saved by yourself. You also must show that you put aside the mortgage payment plus some each month for the previous 12 months. It would be worth doing a calculation on their website. Also as a civil servant your wage will go up a little over the next couple of years.
 
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