Is it easy to get a mortgage? Are the Banks hoarding reserves?

Is it easy to get a mortgage? Are the Banks hoarding reserves?

Is it easy to get a mortgage? Results of a survey released by MyHome.ie this week revealed that two out of three first-time buyers say they plan to buy a property in the next year. However one thing that might scupper some purchases for these potential buyers is a lack of mortgage approval. Of those wanting to buy only 36% have received mortgage approval but haven’t purchased a property yet while 39% are actively seeking a mortgage.

There is no doubt that it is now more difficult to get a mortgage but with more first-timers now wanting to buy will the banks play ball? Have the Banks retreated too far back into their shells to restock their balance sheets to clean up after the years of excess? Are they hoarding reserves and not lending to those who now can afford to buy in the current market?

Have your say: Mortgages

  • Is it easy to get a mortgage in 2010?
  • Or are the Banks hoarding reserves?
There are 7 comments for this article
  1. dokemion at 6:51 pm

    A home equity loan is like a mini-mortgage. It is an amount of money based on the equity in the home, which is the difference between the likely sale price of the home and what you still owe on it. When you get a home equity loan, you get the money, and then you are required to make regular payments until the principal and interest have been repaid over a set period of time. Because the home stands as equity against the loan, these loans have lower interest rates than unsecured personal loans. Some people will use them when buying a larger item, such as a car, or when financing a major repair on their home.

  2. Chalonnaise at 4:46 pm

    The real question here I believe is why would anybody in their right minds want to buy a house right now?

    I’m a first time buyer – when I finally decide to buy – provided the price is right. I nearly caved in under the pressure of the fear of never being able to afford to buy my own home in 2007 with the hyper-inflation we experienced since 1996 – delighted I didn’t.

    As home buyers many of us seem to forget that we are in control of property prices. Not the vendors. It’s a simple case of supply and demand. If it make no financial sense to buy a house; if your rent is less than the cost especially – Don’t do that to yourself.

    The worst thing we can do right now for ourselves, for the economic recovery and our standard of living is to jump back on the “I must absolutely own my own home whatever the cost” band wagon. A home should be enjoyed; not enslaved to. You are all the buyers. You have the control.

  3. Laura at 4:28 pm

    Daniel, brilliant comments. I totally agree 100%. No need to rush into buying. Even if prices stabilized now; I certainly don’t see them rising anytime soon.

  4. Ciaran at 3:12 pm

    Just applying for a mortgage myself; as previously posted; getting a mortgage is no problem… as long as u have a solid job & deposit… u didn’t seem to need either 3-5yrs ago!! … so of course it’s tougher.
    Been watching this market for a while and there defo has been a sudden (in the past month) talking up of the market going on (reached the bottom blah blah) by estate agents/even this site.. it has bounced me into action but on closer inspection; houses >400K in Dublin at least are still dropping like a stone (seen 2-3 cut this week).
    MAybe there is some demand/buying kicking off in the 200-300k (these houses/apart were worth 400-500k so look like a ‘bargin’… but there is NO evidence of prices rising now or anytime soon… so don’t be in a rush.
    I agree with the rent Vs value argurment… it is still seriously cheaper to rent rather than buy <<> myhome editor??

  5. Dee at 2:34 pm

    I agree with damo and daniel. We are in position to move summer 2011. We have a reason to move. My husband job is tranfer to dublin. We are looking for house in Kildare. We havent went to the mortgage yet until June. We are going to pay off all our loans first before we go for the mortgage loan. both of you have mention above that the house prices will settle in 2011- 2012.20% of the deposit, many people who are first time buyer will find it hard to get 20% deposit.Job are still scare, how will they come up with 20% of the deposit? yes, buying the house in the country is cheaper than the city. I live in the country and the price of the 6 bedroom houses here is dirty cheap. I am watching the prices of the house in Kildare. If i am happy with the price i go for it. Hope everything will settle soon, I dont want to rush into buying the house until everything is stable.

  6. Damien at 1:49 pm

    I am 100% in agreement with Daniel’s comment above. I believe the intrest rate hikes from the banks and following that the ECB will drive house prices down even further. The major problem is that greed has not disappeared, and the driver for some sales are because of negative equity, they need the money theory. But in reality we should be providing houses as a means of living not speculating on being rich. As the additional charges for living are only going to increase (Water Charges, Bin Taxes etc…), it is advisable that the first time buyers do not get duped in to purchasing until middle of 2011 start of 2012. By then property will really have settled to its levelling point… We need to think of living sustainable lives going forward because whether we like it or not the overhanging debts of this country will be with us for many years to come… And who has to pay only the taxpayer/mortgage holder….

  7. Daniel at 1:01 pm

    We are now living in the real world again. The banks will loan money when the house is correctly priced and the borrower is financially sound and prepared to share the risk by paying a normal deposit. 20% would be considered a normal deposit in many stable housing markets.
    Irish housing is still overpriced; for example asking €500,000 for a grotty little former Dublin Corporation 3 bed, 1 bath, 90 square meter house that rents for less than €12,000 per year is pure dumb greed. Asking €300,000 for houses in the countryside, miles from a job, a school, a shop or a pub is equally incredible as such a house can be rented for less than €6,000 p.a. in just about any parish in Ireland.
    Keep your money in the bank (hopefully a safe one). Buy only when the prices are realistic, and don’t be conned again by the Irish property industry.

Leave a Reply