The popularity of mortgages in Ireland continues to grow, fueled by declining rates and preferential programs.
However, getting a mortgage is not easy. To do this, the borrower must at least accumulate a down payment and undergo serious scoring by the bank. Everything plays a role in this case, including income level, work experience, credit history, borrower’s age, and other indicators. We will tell you what is the easiest way to get a mortgage and which of the potential borrowers is now easier to get a mortgage.
Buyers with Optimal Down Payment
The down payment is one of the most important factors to consider when applying for a mortgage. Here, a simple dependency works: the bigger it is, the more likely the loan will be approved and the lower the bank’s financial risks. As a result, the borrower benefits from a lower interest rate and more favorable loan terms.
However, a borrower with a too high down payment on a mortgage (40-50%) is not particularly interesting to banks, since the size of the loan, in this case, turns out to be small. Therefore, banks are looking for a balance between low-risk loans and profitable ones. According to experts, the best option for a down payment is 20-25% of the cost of housing.
Borrowers with a proven stable income
To get approval for a mortgage, it is not enough to have an initial payment on hand, you still need to have the financial resources to service the loan. Therefore, banks carefully assess the borrower’s income.
In general, according to experts, borrowers with a stable income can count on the approval of a mortgage.
Government representatives and salary clients
When evaluating mortgage applications, credit committees evaluate a person’s field of employment as well as his level of experience.
Banks are becoming more likely to accept mortgage loans for those occupations. These are civil servants and state employees, whose incomes, even during the pandemic, remained the most stable.
Credit organizations now take into account the age of the borrower: borrowers that are too young and old are considered risky. Those who have not yet turned 21 and those over 65 at the time of loan repayment can refuse a mortgage.
A reliable and attractive borrower is a person aged 30-35
At this age, a person can already be a professional, he has a stable income, created a family, and has responsibility. Therefore, banks do not particularly have to fear servicing a mortgage loan.
Borrowers with good credit score
When issuing mortgages, banks always pay special attention to the credit score of future clients.
It is the failure to comply with payment discipline that is the reason for almost every second mortgage refusal.
Banks pay attention to the number of delinquencies, their duration. If the delays are long, more than 90 days, then, most likely, this will be the basis for refusal to issue a loan.
In general, to make your way of getting a mortgage easier, make sure that you have the presence of a positive credit score, a sufficient level of income, long work experience, a reliable employer, and the provision of reliable personal data.
Written by Bader Albader, market researcher.