Borrowing limit example
Example. A single person with annual income of €45,000, would qualify for a mortgage in the region of €202,000 (4.5 times gross income) over 30 years..
Gross income €45,000
Net Income per month €2,728
202K mortgage stress tested at 6% costs €1,211 per month ( stress test to take account of possible rate hikes) .This is the upper end of affordability and one can see that if interest rates rise to 6% and outgoings are around €1500 per month there is nothing left over.
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Food €500 |
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Clothes €100 |
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Entertainment €150 |
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Transport €200 |
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Medical €70 |
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Holiday average €100 |
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Gas heat phone tv €150 |
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Contingency €150 |
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Insurance /mortgage protection /other charges €100 |
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Total €1,520 |