How Much House Can You Afford? Tips for Setting a Realistic Budget

Buying a home is one of the most significant financial decisions you’ll make in your lifetime. It’s crucial to set a realistic budget to ensure that your new home brings you joy and comfort rather than financial strain. Here’s a comprehensive guide to help you determine how much house you can afford.

Step 1: Evaluate Your Financial Situation

Start by taking a close look at your current financial status. This involves understanding your income, expenses, debts, and savings.

Calculate Your Income: Include all sources of income such as salary, bonuses, and any additional income streams. Track Your Expenses: Document your monthly expenses, including utilities, groceries, transportation, entertainment, and any other recurring costs. Assess Your Debts: List all your existing debts, such as credit card balances, student loans, and car payments. Review Your Savings: Consider your savings, particularly how much you have set aside for a down payment and emergency fund.

Step 2: Understand the 28/36 Rule

The 28/36 rule is a common guideline for determining how much house you can afford:

28% of Gross Income for Housing: Your monthly housing …

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Securing Your Dream Home: The Deposit Requirement

When embarking on the journey of homeownership, one crucial aspect that often comes into focus is the deposit. In Ireland, the question arises: Does a customer always need to have a 10% deposit? In this article, we delve into this important question, shedding light on the deposit requirements for prospective homebuyers in various scenarios. Understanding these requirements is essential for individuals looking to enter the property market with confidence and clarity.

The Importance of the Deposit

Before addressing the specific deposit requirements, let’s recognize the significance of this initial investment. The deposit plays a vital role in securing a mortgage and demonstrates the buyer’s commitment and financial capability to lenders. It also affects the loan-to-value (LTV) ratio, which determines the percentage of the property’s value that can be financed through a mortgage.

Deposit Requirements for First-time Buyers

For first-time buyers in Ireland, the answer to the question is straightforward: Yes, a customer must have a 10% deposit. This means that potential homeowners need to have saved at least 10% of the property’s purchase price before applying for a mortgage. Once …

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5 Ways to save for a Deposit

Saving up to buy a home can seem like a big challenge. Your home is likely the biggest purchase you will ever make, and unlike saving for retirement, this payment is a large sum of money that you will need to access soon. This may seem challenging, but with a solid savings plan, anyone can save enough to put a down payment on their dream home. In this article, we’ll cover 5 easy ways to start saving for your down payment today.

 

Budget your money wisely

The first and most important step in any savings plan is budgeting. To build your budget, examine your bank statements and credit card payments to see where your money is going. Make sure to keep track of how much you spend on necessary payments, such as rent, utilities, and student loan payments if you have them. Next, consider how much you spend on eating out, entertainment, and other nonessentials. While you are saving, it is a good idea to set limits on each of these categories and stick to it, setting aside the …

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Newstalk: Karl Deeter on the Pat Kenny show discussing pensions

The Pat Kenny Show on Newstalk had us on to talk about the future of pensions and to help people understand some of the looming issues in the retirement space.

It is a complex problem which is affected by everything from home-ownership to central bank interest rates. The main thing to take from it is that everybody who can start a pension, no matter how small, should do so. One of the biggest issues is the fact that people don’t even have one they can contribute to.

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Why buy a council flat? Council buyouts to flop.

I don’t understand why a person would want to pay for something they could get for near free or where the charge for said thing is difficult to enforce. You see this every day when people park illegally or don’t put money in the meter, there are clamper’s out there but they don’t catch the vast majority of offenders.

That is why I see two articles in the Irish time that seem to contradict the likelihood of the each other.

Article 1: Council flat purchase scheme to start in 2012 Article 2: Tenants owe city council €21m in rent arrears

In the first one we are told that Dublin City Council (in particular) are close to bringing out a ‘tenant purchase scheme’ via the 2009 Housing Act for people who live in flats. The scheme has a few things that may hamper it…

For a start 65% of …

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Best mortgage rates available, December 2011

This is the usual update of rates available at the moment. As you’ll notice, AIB is the leader in almost every section. However, they are not necessarily lending to every client hoping to obtain finance with them – to know if they’ll be the lender of choice you need to construct the application in a manner that will ensure it shows the best aspects of the case to them.

There are lots of other lenders out there too (we deal with the pillar banks and many others as well), so looking at ‘best rate’ is perhaps different than ‘best attainable rate’.

Anyway, here is the list, if you ever want mortgage advice give us a call! 016790990

Best variable rate mortgage: AIB 3.24% (with one for 2.84% < 50% LTV)

Best 1yr fixed rate mortgage: AIB 4.15%

Best 2yr fixed rate mortgage: PTsb 3.1% < 50% LTV, otherwise AIB 4.65%

Best 3yr fixed rate mortgage: AIB 4.88%

Best 5yr fixed rate mortgage: PTsb 3.7% < 50% LTV, otherwise its AIB 5.35%

Best 10yr fixed rate mortgage: n/A 12/2011

Oh, one …

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Loan refusal statistics: what do they mean?

There are two sets of statistics floating around; on one hand you have the banks who claim that they are lending and also that the demand for credit simply isn’t there – a belief further expounded by John Trethowan. Then on the other hand you have the likes of PIBA who counter claim that 80% of applications are being refused.

So it is important to break down the vital components. First of all, the debate often centres around Small Medium Enterprise (SME) lending; even if demand for that type of credit isn’t there it doesn’t automatically translate into a reduced demand for mortgages. The point being that we can’t compare SME loans/business loan demand to that for mortgage credit.

Secondly is ‘what constitutes a refusal’, and this is where common sense diverges. Even the bank accept that if you seek €200,000 and are only offered €100,000 that it is a loan not fit for purpose, this even goes …

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