Mortgage lending hits a 6 year high

/in /by

Mortgage lending has hit a 6 year high as €5.6bn was drawn down by 30,000 people.

In the last three months of 2016, more than 9,000 mortgages were drawn down. This is the highest number since 2010.

Economists are now expecting a “bumper” level of mortgage activity this year because of the easing of Central Bank lending rules and the help-to-buy scheme.

The total number of mortgages taken last year was 29,498.

New buyers and mover-purchasers accounted for 84pc of the total value of mortgages drawn down, with the rest made up mainly of investors.

The level of mortgage switching continues to increase, but it is coming off a very low base.

Good news for mortgage holders: ECB rate hike ‘years off’

/in /by

There is unlikely to be a rise in European Central Bank interest rates for the coming years, a development that will be a huge boost to thousands of mortgage holders.

Trackers are pegged to the ECB lending rate, and cannot be increased unless the ECB raises its main rate.

It could be three to four years before interest rates rise.

It is estimated that about 350,000 mortgage holders are now on tracker rates, with about 300,000 on variable rates.

All you need to know about the rule change for first-time buyers

/in /by

The Central Bank has made a dramatic change to its mortgage lending rules for first-time buyers.

However, there are also fears that the loosening of the lending limits will lead to even higher property price rises.

First-time buyers will now be able to borrow with a deposit of 10pc, if they meet other lending criteria.

Up to now, new borrowers could have been approved for a mortgage with a deposit of 10pc for borrowings up to €220,000 and a 20pc deposit for all amounts over that. The changes will take effect from 1st January 2017.

At the moment, a first-time buyer purchasing a home for €300,000 needs a deposit of €38,000.

From next year, the new buyer should qualify for mortgage approval with a deposit of €30,000.

This will give the buyer an extra €8,000.

And if the buyer qualifies for the Government’s Help-to-Buy scheme for new homes, they will get a tax rebate of €15,000.

This means they will be able to buy with an effective deposit of 95pc of the property’s value.

Surge in approvals for home loans – but few are likely to buy

/in /by

There has been a surge in the number of people getting approval for a mortgage, but many of these people being approved for a home loan are competing hard with each other for the few houses that are available and are unlikely to end up drawing down the mortgage, experts have said.

In August, close to 3,000 people received mortgage approval to buy a home – a rise of 37pc on the same month last year. However, the number of homes listed for sale on MyHome.ie was close to a historic low – at 23,500 in June this year. Put simply, the lack of housing construction means that greater numbers of potential buyers are focusing on a smaller pool of homes listed for sale.

Central Bank told to change lending rules

/in /by

Fianna Fail and Labour call for deposit cuts for first-time buyers struggling to get on ladder.

First-time buyers are being frozen out of the housing market due to high rents coupled with the massive mortgage down payments they are forced to save due to the Central Bank rules.

Young families hoping to trade-up are also being crippled by the lending conditions which mean they have to save a huge 20pc deposit on any home they hope to buy.

Fianna Fail is calling for the rate for first-time buyers to be slashed by a third if the house-buyer has a proven track record of paying rent for three years.

The party’s submission, which was prepared by Fianna Fail finance spokesman Michael McGrath, also calls for new laws which will force banks to take out insurance against losses arising from borrowers defaulting, or entering into a mortgage arrears resolution process.

The cost would be shared between the borrower and lender – the bank would add an interest rate to the loan to cover the insurance.

Homeowners warned about paying too much for house insurance

/in , /by

The Society of Chartered Surveyors (SCSI) has warned that homeowners may be overpaying for house insurance. It says they are paying for more cover than they can claim in the event that they need to rebuild their home– and overpaying on their insurance premium as a result.

The most common mistake homeowners made was to confuse the market value of a property with its rebuild cost. For example, the average three bed semidetached 95sq m (1,023sq.ft) house in Donegal is €85,000, but the rebuilding cost based on the SCSI house rebuilding guide is €117,000.

In contrast, a similar property in Dublin could sell for €350,00, but has a rebuild cost of €181,000.

Having the correct reinstatement value will not only make certain that you are not over- or underinsuring your property but will also avoid overpayment when it comes to your home insurance premium.

How you can avoid lender rip-offs

/in /by

The chances of getting a bad deal, or even being ripped off, are huge for both new buyers and those switching mortgage providers.

Here are some of the issues to consider, whether it is your first mortgage or you are opting for a new lender by moving your mortgage.

Be wary of cash deals.

Some banks are offering cash-back deals for new buyers and switchers.

This “cash-in-the-hand” offer is proving very attractive. It can represent up to €2,000 on every €100,000 borrowed.

But you will get lower mortgage rates from the likes of AIB, EBS and HAVEN. This means that typically after just eight years, you would be better off at one of these.

Fixed or variable

Many banks have refused to reduce their variable rates, despite demands from Finance Minister Michael Noonan. They have instead offered attractive fixed rates. But be aware that you are locked in with a fixed rate, for the period of the deal.

Some mortgage experts think variable rates may fall again.

Banks’ history of care

Before opting for a particular bank, ask yourself how good is that lender’s customer care.

Cost is not the only consideration. Standards of service are also important. Has the bank a history of overcharging, and how does it deal with those in mortgage difficulty?

Mortgage protection

Lenders will insist that you take out mortgage protection insurance, a type of life insurance policy that pays off your mortgage if you die before the end of the term.

Your lender will often offer to sell you a policy, but you don’t have to buy it from them and, indeed, it can be much cheaper to buy elsewhere. Talk to a mortgage broker who may be able to offer more choice.

Term of mortgage

The longer the term of your mortgage, the cheaper the monthly repayments will be. However, stretching out the term means you end up paying more in interest over the life of the loan.

Consider moving your current account

Both AIB and KBC offer interest rate discounts to new buyers and switchers prepared to pay for their mortgage through the banks’ current accounts. This could make these lenders worth considering.

How are existing mortgage holders being treated?

When taking out a mortgage with a bank, make sure that lender is passing on any rate reductions to existing customers.

KBC Current Mortgage Offers

/in /by

KBC  is offering attractive mortgage deals for customers who are looking to buy their first home, subsequent home, or those simply looking to switch for better value.

  • Rates from as low as 3.30% fixed and 3.25% variable when you open a KBC current account.
  • 50% off KBC Home Insurance for 1 year for new residential mortgages that draw down up to 31st December 2015.
  • Clients who wish to switch to KBC before 31st December 2015 get €2,000 towards legal fees.

Terms and conditions apply.

Contact us to discuss on 01-5052718.

 

 

Royal London 10% off Mortgage Protection

/in , /by

Royal London have announced they are now offering 10% off all price-matched mortgage protection premiums. This special offer runs from Monday 21st September until 30th October 2015.

In the event of death, mortgage protection will make a once off lump sum payment to cover the remainder of your Mortgage. As you pay off your mortgage, your protection cover will reduce to reflect the amount you owe.

Contact us on 01-5052718 to discuss this offer and receive a quote.

Irish pensions suffer worst month since 2008

/in /by

The fallout from the Chinese market crash hit Irish pension funds with the biggest investment losses since the the 2008 financial crash in August.

Irish pension managed funds had negative returns last month, suffering average losses of 5.9pc, according to Rubicon Investment Consulting, which monitors returns across the sector.

Irish pension funds suffered as trillions of euro globally was wiped off the value of stocks, bonds and commodities on fears over China’s economic slow down prompted mass investment sell-offs.

Setanta Asset Management outperformed its peers last month but returns were still down 4.2pc in August while funds managed by Friends First/F&C suffered the biggest monthly drop at 6.9pc.