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With property prices soaring and tighter lending rules coming into effect, getting a mortgage is fast becoming one of life's most challenging problems for young people in Ireland. What can you do to improve your chances of getting a mortgage in Ireland?
Merging different business entities into one unit is a process that needs keenness and a lot of hard work. The merger's success depends on a prior analysis of the pros and cons of the merger to the business and all associated affiliates. Once the benefits of the merger are apparent and the need for the merger real, the execution process is vital for the success determination of the merger. The merger will affect the operations of the business and all the units in the firm; it is, therefore, imperative that before the process takes place, investigations are done on the ability of the business to accommodate the changes and improve the productivity of the firm. Here are key things you should know before you actualize the merger;
Before you start the consolidation, you need to be sure of what the business will achieve from the merger. Do not enter into a merger before doing the analysis and ensuring that the firm will benefit from such an arrangement. Going into it blindly will only serve to destroy your business, be diligent and research.
Every business has work culture and ethics; for any business merger to succeed, the two companies must share a lot in their culture and the general way of executing their plans. There is nothing as difficult as trying to operate when the two business has different methods of doing things. The differences will only lead to disagreements and eventual collapse of the merger. Just like a marriage, there must be some bonding between the business from different aspects to sustain or even boost the business obtained by the firm.
Merging a business is a binding decision that should not be made in a hurry. Proper consultation must be done to ensure that the best decision is reached. Involves all the experts you may need including accounting, legal and economics experts. The panel should guide you before you sign the merger document to prevent flimsy and avoidable mistakes that otherwise has the potential of destroying the business. Know what is to be kept confidential and what is to be revealed to avoid being shortchanged and fighting prolonged legal battles which may have serious cost implications on the business.
It is true that most mergers do not work as well as earlier planned. When you have the allowance of a negative eventuality, you will be in a better position to approach the issue more somberly and make necessary arrangements to cushion your business in case of the merger's failure.
Ensure you have specific needs for the merge, what is achievable from the merger, the expected results and all essential information about the merger business candidate. This knowledge allows you to make informed decisions on the merger.
The benefits of the merger are numerous. However, mergers should be implemented well to guarantee success. If not, the mergers can lead to diseconomies of scale, monopoly environment as well as massive job losses. The suitability of mergers to your business thus depends on how well you research and execute the plan.With property prices soaring and tighter lending rules coming into effect, getting a mortgage is fast becoming one of life's most challenging problems for young people in Ireland.
What can you do to improve your chances of getting a mortgage in Ireland?
Check out our guide...
So we know it's already a big challenge securing a mortgage in Ireland, especially if you're young. And on top of that rental prices in the past 12 months have risen dramatically and are constantly on the rise which leaves young people with even fewer living options. However even though getting a mortgage in Ireland is more difficult to get these days, it is definitely still worth doing your research on the subject to see if you would be viable for one. There is no guarantee of being approved but the pros far outweighs the negative if your dream is to own a house and wouldn't it be nicer to pay for a house you own rather than pay for someones else's mortgage and for it to be cheaper!
In this guide we will discuss in length, rental versus getting a mortgage and what you need to do to improve your chances of getting a mortgage as a young person in Ireland.
Rental prices over the past year in Ireland have skyrocketed across the country. From inner city Dublin to small rural towns, prices are on the increase with no sign of stopping any time soon. On daft.ie, small studio apartments are going for €800 in Co. Meath and from the pictures alone, these apartments are most definitely not worth the price! But people have to live somewhere, so renters are forced to pay these premium prices for sub par accommodation and the landlord lucks out because he is walking away with a nice profit each month. And all landlords are following suit with this tactic. Landlords have even started raising rental prices to long standing tenants in their properties or in some cases giving long term tenants notice to leave in order for them to put the property back on the market to rent at a much higher price. This is going on across the country and people are suffering because of it.
As a result of this crazy rental increase, more and more young people are moving towards the idea of getting a mortgage instead of renting. When you actually break down the price of rent compared to what your mortgage repayments could be, you could actually save money each month. This is pretty crazy and as a bonus of getting a mortgage you would actually own your own home and no longer have to worry about getting your deposit back for your landlord when you move out.
So buying a house just seems to make more financial sense these days but the catch...there's always a catch! The banks are not making it very easy for you, especially if you are a first time buyer. There are way more things to prove to the banks these days and you must satisfy all of their requirements in order to be a viable candidate.
Just because a mortgage looks like the right choice for you, doesn't mean you're going to get one, you need to prove a lot of things to the banks to even be considered these days. Even with a full time time job, bringing in a modest wage to provide for you and your family, as well as years of history paying rent on time etc... you are still not guaranteed a mortgage. You need to tick all the boxes required by the bank in order for you to be even considered.
Some initial key tips to keep in mind before you start the process of getting a mortgage are:
The following are some key factors to keep in mind in order to improve your chances of getting a mortgage in Ireland
Certain banks may calculate it differently but as a general rule your gross income is multiplied 3.5 times in order to determine the maximum mortgage that you can apply for. You need to work this out first to give you an idea of what amount you may be entitled to and also how much of a deposit you will need.
There are some exemptions where you could be approved to borrow more money by certain banks but this is quite rare. Ultimately you should not borrow more than you can afford to pay back as you may face problems with repayments in the future.
Not having enough savings to put towards your deposit is ultimately where your desire to buy a house could end. If you have no savings at all you need to do the math and figure out how long it will take you to save enough money to put towards a deposit. Reducing your outgoings, whether that's downsizing your rental apartment, reducing nights out for cosy nights in and putting your yearly holiday off until next year. All the money saved should go into a designated savings account along with a monthly saved amount. This will look great to the banks and will prove you are efficient at saving money.
As a benchmark for first time buyers you should aim to have a minimum of 10% deposit for the mortgage you want to apply for. If you are lucky enough to have more savings to put towards your deposit this would mean the amount of years repayment would be decreased. You would then have to do the math in order to figure out the exact amount you would need to have for your deposit. You can find mortgage calculators on any of the banks websites that can give you a rough idea of how much you could get and how much of a deposit you would need. This should be used for research only and then confirmed through a direct meeting with each bank before going forward.
If you are struggling to come up with the 10% deposit you should definitely do some extensive research. There are some lenders out there helping first time buyers who meet the right criteria with a help to buy scheme. Lenders offering this scheme would need you to provide a 5% deposit for the mortgage you want to apply for. There are some drawbacks to this scheme as you can only buy a new house or apartment or build yourself. However this could be a great option if you are happy with the restrictions and just want your own home sooner rather than later. And if you were going to go for a new build regardless, it's kind of an ideal scheme for you and something to look into!
When you work out how much of a mortgage you may be entitled to apply for, along with how much deposit you will need to put towards it, you need to ask yourself can you comfortably afford your mortgage repayments each month?
Some people can fall into the trap of taking out the highest mortgage they can get purely because they can and they don't foresee that this could cause problems in the future. Anything can happen to your income, you may lose your job and get another that pays less or your partner gets made redundant reducing the family income. These options are still very common today and you should always be prepared for the worst to happen. By borrowing at your maximum you are not leaving yourself with any room to breath which may result in falling into arrears with the bank and defaulting on your mortgage repayments. Always apply for a mortgage that you can comfortably afford to repay, as you really don't know what can happen to your income down the road, so try to borrow what makes sense to you and your budget.
Unfortunately it is becoming way too common for families and individuals across Ireland to be evicted from their homes by banks repossessing them due to them defaulting in their repayments. It's the rough side of the coin to getting a mortgage and unfortunately becoming more of a reality these days.
The only thing you can do is to be sensible with the amount you borrow and always keep some savings put aside for a rainy day!
In order for any bank to even consider your mortgage application, you will need to prove to them that you have a secure income. This one is actually pretty tough as a lot of people who were badly affected by the recession may only have been made permanent in their jobs for the past 3 - 6 months! But the banks really don't care about your reasons for this, they just want the proof.
So for people who are employed, certain criteria will need to be met by most banks to see that you are in a permanent position in the company and not in a probationary period and that you have been in that permanent contract for a minimum of 12 months.
For people who work on a contract basis, you would need to prove that you have had contract work for a minimum of 12 months or longer with proof of it continuing and that the future of your business is strong.
Each bank's criteria is different so you will need to do your research to find the best lender for you and your circumstances. Ultimately if you have not been working solidly for the past 12 months you should wait to apply until you have, as this alone could mean a rejection on your mortgage application.
So you've shown and proven all of the above and now you have to show the banks that you can actually manage your finances properly. This is one to be aware of as something like this could mean you getting your mortgage application denied. I have seen articles reporting people being refused a mortgage purely on a missed payment of a bill a few years previous resulting in them being blacklisted. And once you are blacklisted there is a high chance of being denied. It can be as simple as that to get refused so keep the following in mind going forward to reduce the chances of this happening to you.
You must show and prove to the banks you can at least manage the following:
As a first time buyer at the beginning of your journey onto the property ladder, getting a mortgage in Ireland can be a bit of a mind field with so much paperwork and so much to prove to the banks. Before you even start your mortgage application it is crucial for you to do all of the above and do as much research as possible. You will just need to shop around all the banks to see what they are currently offering as all the banks have varying interest rates and cash back incentives.
Ultimately it is up to you to find the best mortgage deals Ireland has to offer, that suits you, your finances and your current situation.