Conditions To Apply For A Mortgage

Question 1

List the 6 conditions required to qualify for a mortgage

Answer 1

Amount to be borrowed

Deposit

Credit history

Length of the mortgage

Good investment

Insurance

Question 2

Explain the conditions required for a mortgage in relation to the amount that can be borrowed.
(2)

Answer 2

Applicants can only borrow three and a half times their gross annual income

The lending agency will require proof of income in the form of three recent payslips and the latest P60 form

Question 2

Explain the conditions required for a mortgage in relation to the amount that can be borrowed.
(2)

Answer 2

Applicants can only borrow three and a half times their gross annual income

The lending agency will require proof of income in the form of three recent payslips and the latest P60 form

Question 3

Explain the conditions required for a mortgage in relation to the deposit that is made.
(2)

Answer 3

First time buyers require a 10% deposit for properties up to €220,000 and a 20% deposit over this amount

Non first time buyers will require a 20% deposit

Question 4

Explain the conditions required for a mortgage in relation to one’s credit history.

Answer 4

Applicants need to have a good credit history before they will be considered for a mortgage e.g. have regular savings and no default payments on loans

Question 5

Explain the conditions required for a mortgage in relation to the length of the mortgage
(3)

Answer 5

Mortgage terms can vary between five and 35 years

An older applicant will have to repay over a shorter term

A longer term may be offered to lower the monthly repayments but this will increase the overall cost due to interest

Question 6

Explain the conditions required for a mortgage in relation to whether or not the property is a good investment
(2)

Answer 6

A lending agency will get a property surveyed to check the structural quality before granting a mortgage to ensure it is a good investment

This may make obtaining a mortgage for an older property more difficult

Question 7

Explain the conditions required for a mortgage in relation to the insurance required
(3)

Answer 7

A mortgage protection may be required depending on the type of mortgage

Building insurance is required to cover the cost of damage to the home

A mortgage indemnity bond to protect the lending agency against making a loss If the house is repossessed is required