Mortgage Planning

Many first time buyers in Ireland have been holding back on their decision to purchase a property. Property values have dropped by as much as 70% since peak values in 2006/07 and there seems to be little hope of a substantial recovery in the near future. Renting is an attractive option as it allows you to live anywhere you like, without any long term commitment.

What is the true value of a property? How should we account for the paralysis in the market? Many potential first time buyers are wary of buying when prices continue to reduce, when the country is in recession and in the control of the Troika and unemployment is at levels we thought we would never see again. Many existing people are trapped in negative equity or they cannot afford to lose their tracker rates by moving. Fortunately we are seeing some positive action now on the latter two points.

Bottom feeders with American and Chinese money are getting great deals buying up Irish properties, both commercial and residential. Is it time to buy now?

Credit continues to be tight, with auctioneers often refusing to take offers without seeing a mortgage approval certificate. It is important that potential buyers get loan approval, but this is a process which should ideally start months in advance. The days are gone when all you needed for a mortgage was a pulse and a pay packet. Getting mortgage approval is now more like an Olympic event, so start training now!

For example, lenders are looking very closely at the 6 months bank statements leading up to the application date. Unpaid and referal items will not be accepted, neither will using your overdraft, or paying the minimum amount on the credit card bill. You will also need to prove that you can afford the new mortgage payments, based on a stressed rate of approx 6%. There are many more invisible hurdles to get over, but the point is that planning is vital. Good Financial Housekeeping will have you looking your best by the time you apply, so talk to us as early as possible.

Good Financial Housekeeping

The Loan Arranger Limited t/a Good Financial Housekeeping, Lucas Mortgage Finance is regulated by then Central Bank of Ireland.

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