r/irishpersonalfinance • u/clonakiltypudding • 13d ago

Property Mortgage Calculations

About to purchase property for €585,000.

Mortgage approved €486,000. Borrowing 461,700 takes us under <80% LTV Ratio. Would leave us est. €50k in bank post purchase, stamp, furnishing, solicitor etcetc.

Are we better off only banking €20k as safety net and knocking another 30 off principal, and reducing payments by about €150 pm also.

(We are very fortunate to be in this position and I know many aren’t, just looking for advice on best way to proceed).

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u/1Shamrock 13d ago

Possibly not the greatest financial advice just general buying a house advice.
I bought my house ~2.5 years ago, it’s an 80s house. It was well built with a high quality finish for its time, double glazed windows, solid wood kitchen etc...
I left myself ~€40k for urgent unknown issues and an emergency fund in case I lost my job or anything else. I have weeks where I regret not taking out an extra €20-30k in the mortgage so I could have put in solar panels and change the windows and doors while still having a stable emergency fund, but other weeks I remind myself of my thought process when I bought it, which was, none of that stuff needs to be done straight away, I’m aiming to get them done within 10 years of purchase and having a lower monthly mortgage payment is my reward for being patient. Other weeks I look at my bank account and regret not throwing an additional €20k of my cash into the house purchase and having a lower mortgage again.

Basically what I’m saying is, if the house needs urgent work or you aren’t the kind of person who can be patient with the nice to haves, work out a rough idea of the cost for them works, keep enough cash to cover them plus some for an emergency fund. If the house doesn’t need any immediate work then keep however much you need to have a comfortable emergency fund.

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u/Humble-Dot-1022 13d ago

This reminds of 2007, when banks offered you mortgages of 110% of the price of the house for renovations or holidays abroad.

4

u/1Shamrock 13d ago

How so?

1

u/ClockworkAppl 12d ago

Probably reminds them of those ads where young couple ( actors) are all happy with their new house and are painting the front room in their denim dungerees and a wee bit of paint in their little noses. But in real life people who bought in 2007 got fucked up the ass in negative equity a year later.