First Time Buyers - Case Studies
Mortgage plus can offer great advice if you are a first time buyer within Ireland
Case: first time buyer Amy Burke earns 30,000 a year and - minus small possible annual rises -is at the maximum of her earning power. She has 15,000 to use as a deposit on the 200,000 property she wants. However, times are very hard and Miss Broke needs has no spare cash at the end of the month. Options: Even though an upfront discount might seem appealing to Miss Burke, it would mean she would be on a variable mortgage. Therefore there is no guarantee of the monthly rate she would pay. A fixed rate mortgage, even though it might cost slightly over the odds during a five-year period, at least gives Miss Burke the security of knowing she can afford her repayments. Alternatively, if Miss Burke can find a mortgage with a capped rate that she can afford, this might be a better option as if interest rates go down, she has the chance of paying less.
Recommendation - a Two Year Fixed rate mortgage
Case: Jack Murphy
First Time Buyer Jack Murphy is just about to qualify as an accountant. His salary, currently 24,000 is due to more than double at this time but at the moment things are really tight. Jack’s a lucky man, however. His parents have agreed to lend him 60,000 to help him on his way. He’ll have to pay this back, but only when he can afford it. They have also agreed to help him financially should he get into difficulty in the time up to when he qualifies. Jack wants to get as big a mortgage as possible, on the basis he will find it easy to make his repayments fairly soon, a great first time buyer.
Options
A first time buyers discount mortgage is certainly the most suited to Jack. And if he takes one for just two years, it will be quite a significant discount while money is at its’ tightest. After the two years is up, Jack can afford to either look at other options or go onto the lender’s variable rate. The fact that the discount period is variable is not a problem as in the event that rates do go up, his parents can put up the extra.
Case: Simon Gersh
Simon and his partner have been saving to buy a home for the last 3 years and they now feel that its time to buy a property. They have currently saved over 12000 euros and thier parents have said to give them gifts of over an extra 10000. With a mortgage deposit of 22000 they will be able to go one of two ways, one option is to buy a cheap house with the big deposit and have a small monthly payment or buy a bigger place and pay more each month, it all depends on how they want to play things.
Not many first time buyers have the beauty of a big deposit and alot of them don't even have money to put down so they have to go for the 100% mortgage option which allows you to pay the whole amount off over the time period.
After speaking to Simon and his partner about all thier option they have gone for a 2 bedroom semi detached house, this needs a bit of work but they have saved 4000 from thier deposit money to pay for this.
Case: Steve Burt
When Steve first approached us we could see that money was very tight for him but he really wanted to get on the property ladder and start to invest for his future. Most people don't even know that there is such a thing as a 100% mortgage, after telling him all about it we saw his eyes light up as he realised that there was a way forward for him.
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