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Be it for an investment or your dream home, buying a property can
be a daunting experience. However, it really is quite simple and
being informed can make the experience of buying a property a lot
easier and more enjoyable. The following is a list of frequently
asked questions
Before choosing a house, it is important to know how much you can
realistically afford, The first thing to do is visit an independent
broker and they will be able to calculate how much you can borrow,
based on your earning and savings to date.
Generally, you can borrow up to 90% of the value of the property.
If you are borrowing on your own, you can borrow up to 3 times your
annual salary. If there are two of you borrowing, you can get up
to 3 times the first salary plus 1¼ times the second salary. Regular
bonuses and/or overtime are also taken into consideration.
You need to take out a life policy, which is mandatory part of the
mortgage. You may also wish to take out insurance on the house and
it's content. Your broker will be able to advice you on the best
products for you. You must employ a solicitor, to complete all the
paperwork for the purchase of a house. You will require a valuation
report to be carried out on the property prior to the loan cheque
being released. You may wish to have a surveyor look at the property
before you agree to purchase especially in the case of older buildings
where structural faults, dry rot or dampness may be evident.
This is a Government tax which is payable when purchasing a property.
The rates of stamp duty are as follows:
| Tax Year 2002 |
| Up to €190,500 |
| €190,501 to
€254,000 |
| €254,001 to
€317,500 |
| €317,501 to
€381,000 |
| €381,001 to
€635,000 |
| Over €635,000 |
If you are buying a new home, where
- The floor space is less than or equal to 125 sq. m (1346 sq. ft)
- The property is your only, or main home for at least the next
5 years and you will not earn any rent from the property during
that time.
Don't select a lender based solely on interest rate. The rate is
of course very important but also look at the overall offering.
For example :
- Does the lender charge an indemnity bond or an acceptance fee ?
- Will they give you your first time buyers grant up front and interest
free ?
- Will they allow you flexibility on repayments in the future ?
- What fess and charge apply for existing customers ?
- Choose a lender who will support you over the life of the mortgage
The most important factor is to seek independent advice before choosing
a lender. They will offer you help and guidance through the mortgage
process. They will get an understanding of your circumstances and
recommend a mortgage that best suits your needs both now and into
the future.
In practice, the process from start to finish takes on average 6
weeks. This is due to the large amount of cross checking by solicitors,
valuation partners and lending institutions before clearance can
be given for the raising of the cheque and more importantly the
signing of legal contracts between the vendor and yourself.
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