urgent mortgage needed

Hi,

Can anyone please advise me on where I might get a mortgage for more than is usually given to a couple on my husbands wages. We can prove that we can easily make the repayments without any change in lifestyle. We have quite a bit of possitive equity in our investment properties but this doesn't seem to matter.

We did have an offer from the PTSB but at the last minute we discovered we could not comply with one of the conditions (not out of choice just impossible to do apparently).

We are under serious pressure for time as our builder is not able to wait much longer.

What I'm really asking is if you can point me in the direction of a lender who may be lenient with the amounts they lend.

Any advice greatly appreciated.

In my experience, Ulster Bank have been more lenient than some of the others. You could give them a try. Which condition could you not meet in relation to the PTSB offer?

Thanks, I'll give the Ulster Bank a go.

They wanted us to assign a bond to them. According to the institution holding the bond this is not possible.

You've given very little info.

If you are under pressure you must go to a broker on Monday morning, tell them the full story and they will be able to tell you whether you will get the loan or not and which institution.

Maybe they all see your trying to overborrow yourselves,why don't you sell one of your investment properties ?

thewatcher said:

Maybe they all see your trying to overborrow yourselves,why don't you sell one of your investment properties ?

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or at least do an equity relase on one or more of them in the short term, to cover whatever the shortfall in funds would be from PTSB without this bond being assigned ?

Is there significant penalty for cashing in the bond ?

Does the institution that provided the bond, also do homeloans - if so, they might help given they "caused" the problem ?

Cheers

G>

We have looked at releasing some equity from the investments properties and asking for less on the home build but really it seems to add up to pretty much the same.

It doesn't really make sense to sell one of the investmetns properties as they each make a nice profit every month on rentals.

There isn't a penalty for cashing in the bond, it's can't be done it seems. It's a securied equity bond that will mature in 2008.

I have spoken to a few brokers already some says it should be no problem and others say it's too tight and can't be done. From my experience it seems different brokers get different answers from the same lender, it seems to depend abit on who they know , are friendly with.

Because we have had several different responses from different people/brances of the same lending institution I think we need to keep asking until we hit the one who's willing to loan us the right amount with the right conditions. So again anyone that know of a more lenient lender please let me know. Thanks for the info so far.

Hello JJC,

There are a number of lenders out there that would be considered lenient. But you will end up paying an above average interest rate on the loan amount.

Your could always take out a mortgage with one of these lenders on a variable rate and when your income situation changes you could switch to one of the prime lenders.

Not all brokers deal with the same mortgage lenders. Shop around but most importantly always seek professional financial/mortgage advice and ensure you understand all the terms and conditions that apply to these mortgage products.

JJC said:

It doesn't really make sense to sell one of the investmetns properties as they each make a nice profit every month on rentals.

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Sounds to me like a good time to sell - why wait till your yields drop when property hits the inevitable wall?

Pexus1976, I think at this stage we might consider taking a mortgage with a higher interest rate if we can get the full amount and then, as you say, reassess the situation after a while. Do you know the names of any of these institutions? the only one I've heard of is GE money and they seem to be more an option for those with a bad credit rating (we have an exemplary credit rating).

"they seem to be more an option for those with a bad credit rating (we have an exemplary credit rating)."

Yes your correct but they are also an option for those with limited income!

Lenders do not turn down realistic applications for credit - it's their business to lend money as long as the risk is acceptable and the figures stack up once stress tested at 1 or 2% over current rates and assuming 80% occupancy returns. If you have been declined then there is a problem with your overall profile. You should sit down with your broker or bank and crunch the numbers to find out why there is reluctance to lend - there WILL be a reason.

Sarah

www.rea.ie

Sarah W said:

Lenders do not turn down realistic applications for credit - it's their business to lend money as long as the risk is acceptable and the figures stack up once stress tested at 1 or 2% over current rates and assuming 80% occupancy returns. If you have been declined then there is a problem with your overall profile. You should sit down with your broker or bank and crunch the numbers to find out why there is reluctance to lend - there WILL be a reason.

Sarah

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Yea,their over stretching themselves !.Was talking to a buddy of mine the other night,he is now the proud owner of 3 properties on a plumbers wage.He is mortgaged now close enough to the 1 million mark,what the hell are the banks in this country up to in relation to lending guidelines.

I did tell you the reason, we are asking for more than they usually give. that's it pure and simple.

Can you explain why the same lending institution have agreed to different amounts depending on who we ask. In some cases a difference of 50K.

Also we have approval for the full amount if we assign one of our equity bonds to them - surely then this lender at least thinks we are able to make the repayments. We also save more than the monthly repayments would be and have done for the past 3 years.

I'm hoping to get some opinions on which lenders are most likely to give the full amount.

If you could post full details of your incomes (PAYE and rent), outgoings (mortgage repayments and any other loans), asset values and liabilites either I or one of the other brokers who post will be able to advise you.

Sarah

www.rea.ie

JJC said:

I did tell you the reason, we are asking for more than they usually give.

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.... If William Gates walked into the bank in the morning I can guarantee they wouldn't say "sorry, we don't usually give that much".
Its a reflection of your income (rental income is not guaranteed).


The bank will weigh up the incomings and outgoings. Yield from property rental is not a guaranteed income. Looking at a person with numerous investment properties what happens if the rental market begins to slow? The bank would be left with a customer who had enough savings to cover the mortgage they gave, but not to make up a possible shortfall on all/a few of the properties.

The figures you'll be quoted will vary hugely depending on what broker you go through (and possibly even on who you speak too if you go direct). As you've said, keep looking until you get the figure with the T&C's you require.
As for which companies will be most lenient, it’s very tough for any institution to be knowingly lenient without falling foul of the regulations for responsible lending. The only real way is to apply to as many as possible and see how close you can get.

My husband wages are 78K he also gets some bonuses (though not guaranteed) last year bonus 8K, 6K for each of the 2 years previous.

I am a housewife - no wage.

Investment property 1 : worth 320K owing 200K monthly repayments of 625 rental income monthly 980

I Property 2 : worth 300K owing 200K monthly repayments of 595 rental income monthly of 900

I Property 3: worth 280 owing 175K monthly reapayments of 750 rental income monthly of 820

I property 4 (Foreign): Worth 560 owing 200K monthly repayments 1500 rental income (monthly averaged over year) 2400

Savings: shares 89K 4 secured equity bonds estimated at the moment worth 330K initial investment 100K 100K 30K 30K so at worst 260K
Other savings and cash 50K

We have no loans other than 2.5K on credit card ( cleared each month)

We have a good credit history.

We pay rent ourselves of 780 per month until we build the new house. We have 2 children under 3.

The amount we want to borrow is 440K The house will cost 410 we will use 30 of our cash.

I for got to say that the site we're building on is valued at 290 and we owe the bank 60K on it month repayments of 300.

I think that's every thing. Only to say that the foreign property is mortgages to a spanish bank and it's not possible to remortgage for much equity release.

I forgot that we put 1645 each month into savings.

I can't imagine why you'd have any problem getting the loan. Investment Properties 1&2 sound like interest only mortgages. Maybe the bean counters see these as being a risk to your future income?

Lenders won't take the foreign property income or mortgage repayments into account.

Have you approached the lender(s) you are currently with? What is the overall new loan required - €60k existing plus €410k to build or €60k plus €440k? And what is the expected end value of the new house? Finally is your husband's basic salary €78,000 plus bonuses or are they included in the €78,000?

Sarah

www.rea.ie