Strengths and weaknesses of interest-only mortgages

Interest-only mortgages have surged in popularity within the mortgage industry, offering a distinctive structure and potential advantages. Yet, like any financial tool, they come with both pros and cons that warrant careful consideration for prospective homebuyers. In this article, we delve into the merits and drawbacks of interest-only mortgages, empowering you to make a well-informed decision regarding their suitability for your journey to homeownership.

Interest-only mortgages offer several appealing advantages. Initially, they feature lower monthly payments compared to conventional mortgages. During the initial period, borrowers are solely responsible for paying the interest portion of the loan, resulting in more manageable payments, particularly in the early stages of owning a home. Moreover, opting for an interest-only mortgage can free up additional cash flow, which borrowers can redirect towards other financial objectives or investments. This flexibility is especially beneficial for individuals with variable income or those seeking to optimize investment opportunities. Furthermore, some borrowers may opt for interest-only mortgages to invest the savings from lower mortgage payments into higher-yielding investments. Financially savvy borrowers may reap rewards if these investments yield returns surpassing …

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The role of credit scores in mortgage approval

Understanding the intricacies of credit ratings is paramount for those seeking mortgage approval, as it significantly influences loan conditions and eligibility. In Ireland, where securing financing for one’s dream home is a significant milestone, comprehending how credit scores affect mortgage approval is essential.

Credit scores serve as a key metric for lenders to gauge an individual’s creditworthiness and repayment capability. Factors such as payment history, credit utilization, credit history length, new credit accounts, and credit mix contribute to these scores. Timely payments, low credit utilization, longer credit history, and diverse credit portfolios are all factors that positively impact credit scores.

Mortgage lenders utilize these scores to assess risk levels associated with lending and determine interest rates, minimum credit score requirements, and down payment obligations. Generally, higher credit scores translate to lower interest rates and more favorable loan terms, while lower scores may lead to higher rates, larger down payments, or even application rejection.

Various types of mortgages and lenders may impose different minimum credit score requirements. Conventional mortgages typically demand higher credit scores compared to government-backed loans like FHA or …

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Are mortgage interest rates going down?

With the recent announcement of PTSB dropping their 4 years fixed rate and announcing low 3 years fixed rate, things sure look like the decline of mortgage interest rates is about to start. You could save yourself a could of euros a month in mortgage repayment by switching to another lender with lower rates.

Contact us today to see which rates you could get and how much you could save.

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Buying your own home in Ireland

 

At some point in your life, you may wish to ditch the rental market and buy a home. Buying a house can be a wonderful and exciting time. But it can also be a complex and confusing process if you are not fully informed on the processes involved in buying a house. There are basically 5 steps to the process of buying a property in Ireland.

So, here’s a quick summary of the steps;

Financial Stage House search House viewings Putting down an offer Closing the purchase.

 

 Financial Stage

This is the most important step when it comes to buying a property in Ireland. There are two ways to buying a property, you can either buy it outrightly with cash or purchase through a mortgage. A mortgage simply put is a type of loan used to buy a property. The amount you have as cash and the amount you can get from the mortgage lender can help you set a budget on the value of property, type of property and location you can buy in.

If you are …

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No Deposit? No Worries!

In an inflated economy, saving up for a deposit can seem like the most difficult part of buying a home especially when most of your net income is going into paying rent and your monthly bills. While having a large deposit gives you the best chance of getting a good mortgage deal with a low interest rate and a bigger house, there are options available for people with lower deposits and government help to get you on the housing ladder.

The average first-time buyer puts down a 10% deposit on their first home, which could mean finding a daunting €30,000 (on a €300,000 property) or more. However, there are also a few government schemes to help first time buyers get on the property ladder. These include the Help to Buy & First home Shared equity scheme.

Although the Help to buy scheme only applies to new build properties, with the purchase price of less than €500,000 and has a maximum amount of €30,000 that you can claim (please see more information about the scheme on the Citizens information website or …

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Are Irish banks the most generous in Europe?

Mortgage rates are rising, but at the time of writing they are higher in Germany than in Ireland, that isn’t the strange bit though.

What’s really strange is that the risk free rate in Ireland is higher than the mortgage rates available. In other words, financially speaking it is safer (if by ‘safe’ you mean accepting a lower return) to lend to a person in Ireland on a house than it is to lend to the Irish government. This is insane and it won’t last.

The response will need to be one of two things.

Banks stop lending Banks raise mortgage rates (or perhaps a little of 1 and a good dash of 2).

Take a look at government bond yields from last week, if a bank has a choice they can lend to the Irish government at 2.8% but they lend to people at closer to 2%. This is typically seen as an impossibility in financial markets so it will only last for a short time because as a rule there is no arbitrage, markets close them down …

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People Are Shifting to Digital Mortgages, Here’s Why

Digital mortgages are becoming increasingly popular due to the increase in technology. People are more likely to want to take care of everything online. This change came in full swing when the COVID pandemic happened. 

 

Companies and people alike had to go through the transition period of shifting everything remote. Once people discovered that things can be done this way, they did not want to go back.

 

OnlineApplication is a company that decided to make a software that would simplify this process for everyone involved in the process. Helping the brokers, lenders and the borrowers.

 

By providing a point to store all documents safely in one place, it eliminated the need for face to face meetings and stacks of paperwork. Beneficial to both sides. 

 

Benefits to Digital Mortgages

 

Digital mortgages have many advantages opposed to applying for them on paper, in person. 

 

One of the benefits to Digitally applying for a mortgage is a faster pre-approval. The system that OnlineApplication has will go through your data and pre-approve you without the need for a …

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How to Apply for a Digital Mortgage Online

Gone are the days of doing painstaking research to find the best bank to get a mortgage from. Buying a house or apartment is already difficult, why go through the hassle of loads of paperwork when you can fill out your information online and have it done for you.

Technology has evolved and with it, the digital mortgage process has too. Applying for a digital mortgage takes the stress out of your hands while simultaneously finding the best rates.

Getting Started

Starting the mortgage process can be an overwhelming situation when looking from the beginning. Companies such as OnlineApplication work to make this process fast and easy to use.

The pandemic has shifted much of work to online and gotten rid of the need for face to face interactions. With this new technology why would you do anything on paper?

What is OnlineApplication?

OnlineApplication is a company that works for brokers to find the best mortgage.

Our quick and simple process allows you to upload all your financial information to our safe and secure website. After that we …

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European property and mortgages: Frankfurt

Residential real estate is as popular as ever. Many people fulfill their dream of owning their own home with a one- or two-family house or a condominium. High demand is driving real estate prices to infinity. The problem of housing shortages is on the rise. Forecasting future prices is not that easy. Rents could rise even further due to excess demand. Many are therefore looking for alternatives. These include buying condominiums or single-family homes.

The average asking price for a condominium in Germany was €3,748 per square meter in the first half of 2021. This represents an increase of 15.1 percent compared with the first half of 2020. In previous years, the annual increase had still been around ten percent. One- and two-family houses and terraced houses were offered for an average of 350,000 euros, representing an increase of 12.9 percent.

However, this does not apply equally to all of Germany. There are significant regional differences. The best example here is eastern Germany, which is still considerably cheaper than western Germany. It doesn’t matter whether we’re talking about condominiums and …

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European mortgages explained: Czech Republic

About Czech Republic

The Czech Republic ia a state in Central Europe. It is a landlocked state of 78,870 km2. It is bordered by Germany, Austria, Poland and Slovakia. The capital city is Prague. The Czech Republic is a market economy country that belongs to the highly developed countries of the world, according to economic, social and political indicators. Economically it belongs to the world’s 31 riches nations with the highest financial incomes, according to the World Bank. The unemployment rate has been low for a long time and below the average for developed countries.

History of the Czech Republic

Czech Republic was first populated by Celts 4th century. In 863, the Byzantine missionaries Constantin and Methodius come to the part of the present-day Czech Republic and introduced Slavic liturgy there. The defeat of Austria-Hungary in World war 1 cleared the way for the foundation of an independent state of Czechoslovakia, which was founded on October 28, 1918. The first president of Czechoslovakia was Tomáš Garrigue Masaryk. On January 1, 1993, Czechoslovakia was divided into two independent states: Czech Republic …

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