We’ve covered everything from dream jobs to renting in the last few weeks, but what about that next big step?
You’re finally financially secure, you feel like you may be ready to settle down a bit and now you’re looking at buying your own home.
The only problem is – you don’t know where to start.
Don’t worry though, we’ve put together a handy guide to get you on that property ladder as painlessly as possible.
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Step One: Start saving
It’s all about the deposit at the start so it’s crucial that you have the deposit saved before you go anywhere looking for a mortgage.
One of the main things that banks look out for when evaluating customers is a good savings record so figure out what you can afford to pay each month and set up a standing order to your savings account.
Don’t forget about hidden costs such as legal, life insurance, stamp duty and others.
Step Two: Sort out your paperwork
If you are a PAYE worker, this is a little more straightforward.
The bank will need proof of employment, approximately three months of payslips and six to twelve months of bank statements.
They will also want to see that there is money coming into your account on a regular basis and you can live within your means, while looking at your track record with loans and credit cards – remember constantly being overdrawn or having a bad credit rating will work against you.
If you are self-employed, you will need at least two years of certified/audited accounts, written confirmation from an accountant or auditor that your personal/business tax affairs (PAYE/PRSI/VAT) are up-to-date and management figures for current trading year.
Step Three: Shop around
You can get mortgage approval in principle before you start house hunting so make sure to try a few different banks to see who is offering the best deal.
Make an appointment with one of each bank’s mortgage advisers to discuss your application. The National Consumer Association has a handy mortgage calculator on their site, which is a good place to start.
There are several different types of mortgages but most buyers will opt for an annuity mortgage. Also known as a repayment mortgage, your lender works out the amount you need to repay each month.Your monthly repayment is made up of two parts: an interest payment on the loan and a capital repayment (paid off the balance).
You can usually choose either a variable rate or fixed rate annuity mortgage or in some cases a mixture of both (known as a split rate).
Step Four: Let the viewing begin!
Congratulations!
If you’ve received agreement in principle, you are now ready to start looking for your perfect home!
Try property websites, auctioneers and estate agents and make sure to view plenty properties before making the final decision.
Remember practicalities such as upkeep, proximity to work and schools, public transport and energy efficiency (BER).
If the property was sold since 1 January 2010, you should be able to check out the details surrounding the sale here. Other things to consider are the availability of amenities such as internet and natural gas and the situation regarding planning permission if you decided to extend in the future.
Once you’ve decided on a house, it’s vital to have a survey carried out as the vendor is not obliged to reveal any defects of the property. You can find a list of chartered surveyors here.
Don’t forget – You will need to have mortgage protection insurance and home insurance before you sign a contract and pay a deposit (less any booking fee).
For more information, click here.
