Mortgages.ie Summer Newsletter

Welcome to Mortgages.ie Summer Newsletter.

If you would like to discuss any of the issues in this newsletter or if you need financial advice please Call us on 1850 320 920 or request a call back by completing our Contact Form

First time buyers Lending criteria update

If you are considering buying a home and taking out a mortgage in the near future, please note the following key features of successful applications:

1. Permanent full time employment
2. A steady savings record and/or evidence of rental payments for over a year which will help us assess your ability to meet repayments
3. You will require a deposit of between 8% and 10%(depending on lender) of the purchase price. This may come from a combination of savings and parental assistance.
4. For a single applicant, the income should be €30,000+ and for a joint application €40,000.
5. Well managed current accounts maintained in credit with no unpaid or referral items
6. Preferably no personal loans. If you have loans, provide clear evidence that you can comfortably afford both the mortgage and loan repayments.

Mortgage and protection products that may appeal:

1. 4 year Fixed rate 3.99% (apr 3.45%) on remortgaging with a maximum loan to the value of 80%. Some high profile lenders are offering 5 year fixed rates as high 5.75% to existing clients.
2. Switching your mortgage and up to 40K short term debt through KBC and also €1,000 legal fee contribution. The short term debt can be refinanced over the same term as your existing loan, but at mortgage rates. (Excludes credit card debt and subject to maximum ltv of 80%)
3. Offset mortgage. Not for everybody but if you have a reasonable level of savings and a mortgage you may find this attractive. This product becomes more attractive in the current environment where deposit rates are falling and mortgage rates are rising.
4. Income protection contribution attracts tax relief at your highest rates. Income protection replaces up to 75% of your income if you are unable to work through accident or illness. With the tax relief taken into account this can be an attractive peace of mind product.

Be Careful

1. Think long and hard before switching out of a tracker mortgage.
2. Keep an eye on your own lender's fixed rates. You might (for some reason) not want to fix at the moment but if other lenders change their policies towards switchers (as AIB did recently) you do not want to be left with limited switching options.
3. Prospective First time buyers should be aware that full mortgage interest relief will be discontinued at the end of 2011. Some reduced relief will be available for purchase in 2012 with full discontinuance for houses purchased after 2012. (First time buyers who bought from 2004 to 2011 will continue to receive relief until 2017)
4. Many home owners do not know what type of life policy/mortgage protection they signed up for and whether it meets their needs in terms of protection or cost. Take a few minutes to see what your policy covers and if you need some advice please give us a call.
5. Alarms. Be vigilant if you are claiming discounts for alarms on home insurance policies. We recently came across an incident where a client who received a discount for a home alarm found that the insurance company would not pay out on burglary claim because alarm was not on at the time of the break in.

Interest Rates

We expect interest rates to rise over the coming years, as lenders look for higher margins and as the ECB raises base rates. We do not think it is unreasonable to expect variable base rates to be around 5% in mid 2012.

An independent financial Review may save you thousands!

Your financial affairs are important to you and your family. With the world we live being full of uncertainty it really does make sense to sit down with a professional and take stock of where you are and where you are going. Call 1850 320 920 or email caroline@mortages.ie to arrange a meeting.

Call us on 1850 320 920 or request a call back by completing our Contact Form

Warning: your home is at risk if you do not keep up payments on a mortgage or any other loan secured on it.

Variable rate loans: the payment rates on this housing loan may be adjusted by the lender from time to time.

Warning: you may have to pay charges if you pay off a fixed-rate loan early.

Warning: before fixing your rate, check what rate will apply to your loan after the fixed rate period expires.

Finance Company of Ireland t/a Mortgage Company of Ireland is regulated by the Financial Regulator.