The media headlines have been dominated by doom and gloom during 2020. Some of these headlines have included sobering news about mortgages.
Today, we’re here to share the good news with you.
If you’re in the market for a mortgage, feel reassured that the lenders in Ireland are still open and lending. And they want your business!
Fears around mortgage market prove unfounded
When lockdown first happened in Ireland, there were huge fears that the mortgage market would cease to a halt. May’s figures confirmed these fears with approvals down by 62%.
However, that number changed dramatically in June, when a substantial increase in the number of approvals and drawdowns was noted.
This upward trend has continued since then. At Which Mortgage, we’ve worked with a large number of clients throughout the years and have secured mortgages for them.
Proving repayment capacity is key
The Central Bank of Ireland’s Consumer Protection Code governs how banks lend towards borrowers.
One of the key criteria lenders have to follow is to show that they have assessed affordability at the time of the mortgage application. Lenders do this by asking for evidence of regular income and looking at repayment capacity.
Get yourself “mortgage ready”
We’re here to help you prepare your mortgage application. Our advice to our clients is always to follow the following five steps to secure a mortgage now. Some of these begin months in advance of an application being submitted to a lender.
- Eliminate your debt.
- Make sure that you eliminate your debt before you apply for a mortgage. If you can’t eliminate all of your debt, reduce it as far as possible.
- Especially make sure that your account does not go into overdraft every month.
- Credit card debt is also a red flag to a lender.
- If you have loans, make sure that you are keeping up with the payments.
- Show consistent savings.
- One of the strongest ways to reassure lenders that you will be a responsible borrower is by showing a regular savings habit. Our blog on how to save for a mortgage will get you started.
- Prepare your paperwork to show repayment capacity.
- You need to include your bank statements and salary slips in your mortgage application. Have at least six months worth of documents.
- You will also need to provide your passport and utility bills as proof of identity.
- Use a mortgage calculator.
Please feel free to contact us if you are in the market for a mortgage. We’d be delighted to chat with you and secure you the mortgage you need for the home of your dreams!