What do I need to provide for a mortgage application?
- Identification (driving licence back and front or passport.)
- Employment detail summary
- If self-employed 2 years accounts, form 11, Chapter 4 and tax clearance
- 6 months current account statements
- 6 months savings accounts (Bank and credit union accounts)
- 6 months loans (personal, Mortgage or car if any)
- 3 months credit cards if any
- 3 consecutive payslips.
- Proof of address…Utility etc
What is the difference between variable and fixed rate?
A variable rate means the interest rate on your mortgage is subject to change and could go up or down depending on the market and other factors. This can affect how much you repay each month but does allow for more flexibility in paying extra off your mortgage or just paying it off without penalties.
A fixed rate mortgage allows you to fix in an interest rate for a certain amount of time where you interest rate and repayments stay at the same level. This can add a level of security in knowing exactly what must be repaid each month. During your fixed rate you will not be affected by rate increases but also miss out on any rate decreases. Also, if you want to break out of a fixed rate there are penalties to be paid.
What does Loan To Value refer to?
Loan-To-Value ( LTV) refers to the percentage difference between your mortgage amount and the property price. The amount you must have saved for your deposit which for first time buyers is usually 10% of the purchase price, this is your equity in the property, and the mortgage amount would be 90% of the purchase price giving you an LTV of 90%. The higher your equity share the lower the LTV.
Example
Property Purchase Price: €300,000
Deposit Amount: €55,000
Mortgage Amount: €245,000
Loan-To-Value: 81.6%
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