Something to watch out for – if you are ever applying for a mortgage

Over the weekend just passed, during an evening out with some old friends, we were sharing some experiences of day to day financial matters in Ireland at the moment.
Based on the experience of three of us there, it seems that it’s pretty safe to say that the Irish banks are looking for any reason whatsoever to not provide mortgages for any type of home purchase – no matter how qualified the applicants might be.

As far as I’ve been told, the main Irish banks are still, even now, not carrying out the required checks to determine whether or not an applicant is qualified.

Previously, to the detriment of the whole country, banks pretty much said yes to anyone who came to them looking for money – without doing any proper checking.

And today, I’m told, they’re not doing any checking on applications either – though this time they’re saying no to pretty much any applicant – still to the detriment of the country.

I have been told of one mortgage applicant who has thousands of euros in savings available for a deposit to purchase a house that they won’t be getting a mortgage because they have “no savings history”.

It seems, at least according to one Irish banking “pillar” that even though having significant savings isn’t proof enough of a savings history – evidence is required of those savings being accumulated.

So, if you’ve been diligently saving for 10 years with a particular financial institution, built yourself up a nice nest egg, and then decide to transfer that balance to another institution to avail of a better interest rate, this banking pillar won’t accept proof of lodgement and a current statement from that new institution as proof of a history of savings.

It’s a ridiculous no-win situation when dealing with banks in Ireland at the moment. It’s almost as ridiculous as the the banks universal desire to move clients onto paperless banking, but then not accepting online banking printouts and statements as documentary evidence when processing any credit applications.

3 Responses to Something to watch out for – if you are ever applying for a mortgage

  1. James June 7, 2011 at 13:42 #

    They might well have saved the money but they also could have got a lump sum from their parents that they lodged to a new account.

    Could they not get a statement from the institution that they accumulated the money in originally?

  2. valueireland June 7, 2011 at 22:45 #

    I suppose, James, my point is that if I close an account with a bank for a reason, particularly some time ago, I hardly want to have to be going back to them to get old statements reprinted.

    If I deposit a lump some to a new account (no matter who it’s for) surely money laundering legislation checks carried out properly in one institution would be enough to satisfy any other institution of the provenance of the money lodged?

  3. James June 8, 2011 at 13:54 #

    The money laundering checks wouldn’t pick up on a parent giving a child money that is below the tax threshold.
    I agree that Banks are not lending and are being to stringent now compared to how they were but I don’t think it is unreasonable for somebody to be able to prove they have saved money so they are better placed for the mortgage repayments

Leave a Reply

Powered by WordPress. Designed by WooThemes

hit counter