Two bank refusals and love nest may be yours

    Building for the future

    By Jimmy Rhatigan

    MORTGAGES are not being thrown around like confetti at a parish wedding but the chances of getting the key to a new home are improving if you can jump through the right hoops.

    That is the update for first time buyers, those who may consider setting up a home sweet home, a love nest perhaps after saying ‘I do’ or perhaps uttering nothing at all.

    The irony is that if you are refused a loan by your bank and then draw another blankety, blankety from a sister bank or building society, you may be home and dry.

    It would appear that a refusal is the new permission as couples, male, female or mixed plan their love nests.

    At first, a new government plan to help wannabe home owners would seem to be as easy as A, B, C.

    Unfortunately, life is not always as simple as that but there is life after being given the thumbs down by bankers who were bailed out by our people.

    There are terms and conditions and the more interesting one may be the following:

    You will need letters from two banks or building societies confirming insufficient offers of finance.

    Such letters, that heretofore may have meant the beginning of the end of a couple’s home of their own, may prove to be as useful as a latch key.

    Brickies and hod carriers should be busy

    In racing parlance, if you fall at two fences, you can still ride on to win the Thyestes Chase at glorious Gowran Park.

    The epistles containing the bad news from bankers or building societies will entitle couples to apply to Kilkenny Local Authorities for a Rebuilding Ireland Home Loan that, since the beginning of this month has been open for business to provide mortgages at reduced rates to first-time buyers.

    Applications for loans have a list of 10 supporting documents including proof of marital status, evidence of earnings, details of bank accounts and other documents that at first seem complicated but are generally routine,

    A local authority loan can be used for new and second-hand properties, or to build a home and you can choose to fix the rates for the full term of the mortgage, so you have the same repayments for the lifetime of the loan.

    Reasonably rosy so far, Reporter readers may agree.

    But the road does get a bit slippery.

    For instance, you need to show that you can afford your monthly mortgage repayments, which must be one third of your household income.

    Then comes the nitty gritty.

    You must be a first-time buyer and if you are making a joint application, neither applicant can own or have previously owned a property. Age limits are between 18 and 70.

    You must be in continuous work for a minimum of two years.

    As a single applicant you must have a gross annual income of €50,000 or less and you must have a satisfactory credit record.

    Joint applicants must have a total gross annual income of €75,000 or less.

    You can borrow up to 90% of the market value of a property which can be new or second-hand.

    A credit check will be carried out with the Irish Credit Bureau and the courts before a loan approval is granted.

    You must also have a deposit of at least one tenth of the market value of the property.

    When you have the required forms filled up, you must bring the forms and supporting documents to your local authority, in person.

    You are at the final fence.

    The winners’ enclosure is a good leap away.

    The rules where you need two failures to be a success may be a paradox of some kind.

    But for a local couple who told The Reporter they were delighted to benefit from the former Kilkenny County Council Scheme, local authority help was a huge fillip.

    Where the couple were paying €700 a month in rent, dead money, they are now paying €700 at the end of every month for their mortgage which includes an insurance policy on both of their lives and they are now on the property ladder.

    Brickies and the hod carriers should be busy and Paddy on overtime on the mixer.

    The new scheme which has to be welcomed may not solve our homeless problem but it should be a help.