Maximum Mortgage Finance

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DOS19

Registered User
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Hi there

Upon renewing my approval in principle with AIB, I was disappointed to see that they had revised downwards the maximum mortgage amount I could borrow from €319,000 to €280,000. The term of 35 years remained unchanged. The reduction apparently arose due to new lending criteria.

I earn €60k p.a in a permanent job, am 30 years old with no debt and have a good savings history. I will be borrowing on my own. Am I likely to obtain to a higher maximum borrowing with another lending institution or is €280,000 the highest sum I can realistically look to borrow?

Many thanks.
 
DOS19 said:
Hi there

Upon renewing my approval in principle with AIB, I was disappointed to see that they had revised downwards the maximum mortgage amount I could borrow from €319,000 to €280,000. The term of 35 years remained unchanged. The reduction apparently arose due to new lending criteria.

I earn €60k p.a in a permanent job, am 30 years old with no debt and have a good savings history. I will be borrowing on my own. Am I likely to obtain to a higher maximum borrowing with another lending institution or is €280,000 the highest sum I can realistically look to borrow?

Many thanks.
Click to expand...

In a word, no. Multiples have all dropped (with good reason) and I'm surprised you even got 319k initially. That is >5 times salary.

On 60k you have a take home of 3,327.78 currently. With up coming austerity you can expect this to drop but lets work from here.
280k over 30yrs@4% gives a repayment of 1336.76. Or over 40% of your net disposable income.
Stress test it to 6%, a low figure but what the bank seem to like using and you have a repayment of 1678.74, or almost 50% of your disposable income.

And that is before you payment for insurance, maintenance, household tax (this *will* go up above the current €100, take a look at the US to see where it is headed. They pay 2-4% the value of the house per year on average).
 
I'd agree. You're at the upper end of the scale already. ICS will do 5 x basic salary for a single First-Time Buyer earning €60,000 but will only go to 90% while AIB will go to 92%.

Liam D. Ferguson
 
BOI approved/offered me 5 times my salary but I have saved approx 22% of asking price over the last 4 years. First time buyer Single applicant and good credit history.
 
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