Getting a mortgage “is not impossible” in Ireland anymore, according to a leading broker.
On Alive and Kicking with Clare Mckenna today, Managing Director of Mortgage Navigators, Margaret Barret, gave tips on how to best prepare for a mortgage application.
It comes as 52,634 new mortgages were issued around the country last year.
Ms Barret said now is a great time to apply, considering recent market improvements.
“It is actually possible for people to buy a house in 2024,” she said.
“We have just come out of a year of property completions that have been the highest on record since 2006.
“We have completed over 33,000 houses and 26,000 first-time buyers got into their homes in 2023 - so it is positive.”
Bank statements
Ms Barrett said the first thing to do when preparing to apply for a mortgage is to print off your last six months' bank statements.
“You need to review it line by line to look at your budgeting,” she said.
“If you're renting, you’re automatically demonstrating to the bank that you can make your mortgage repayments – that’s part of the proof and repayment capacity.
“If you're saving, that’s also repayment capacity.
“The banks will always look for to find out - if you’re capable of paying a mortgage off over the next 30 to 35 years.”
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Ms Barrett said many people are already paying rents that are much higher than most mortgage repayments.
“The average rent in Dublin is at €2,300, which the mortgage repayment will likely not be,” she said.
“If you borrowed €300,000 over 30 years on a green interest rate, which is 3.65% currently, your mortgage would €1,370.
“That is nearly €1,000 cheaper than the average rental outgoing in the Dublin market.”
Getting a credit check done is also very important, according to the mortgage broker.
“The reason we want you to do that is so we know if there are any skeletons in the closet,” said Ms Barrett.
“Sometimes people might have forgotten about a credit card that is still outstanding with repayments or a loan with missed repayments.
“Knowing that upfront is a huge plus in the mortgage assessment process.”
Financial limits
Ms Barrett said it is important to understand your financial limits when taking out a mortgage.
“You’re going to be left with this mortgage commitment for the next 30 years so it actually has to feel very comfortable,” she said.
“The best way to describe a mortgage repayment is it has to be comfortable on your worst month.
“That can be December for some when they have Christmas, Santy and extra expenses.”
Other tips she outlined included getting mortgage protection before the application process begins and making sure it’s possible to insure a secondhand home before a purchase is made.
Main image: A housing estate under construction. Image: David Creedon / Alamy Stock Photo
