Buying your first home is a big step in anyone’s life. And if you’ve never gone through the process before, it can be a little intimidating. But never fear, our mortgage guide for first time buyers sets out everything you need to do in a few simple steps.
A Step-By-Step Guide to Getting a Mortgage
Buying a home is a big step in anyone’s life. And if you’ve never gone through the process before, it can be a little intimidating. But never fear, our mortgage guide sets out everything you need to do in a few simple steps.
1. Find Out How Much You Can Borrow
Want to find out how much you can borrow right now? With our online mortgage calculator, it couldn’t be simpler. Just go to our mortgage calculator, enter a few details, and we’ll be able to tell you how much you can borrow instantly. You can then complete the application form and get approval online.
2. Talk to Us
Even if you’ve only just started thinking about applying for a mortgage, a chat with one of our mortgage advisors can be really helpful. They’ll be able to answer any questions you have, and it’s always nice to have a friendly face to help you through those uncertain first steps. They’ll also take you through the whole process and let you know all the goals you’ll need to hit along the way.
3. Saving for Your Deposit
Saving for your deposit may seem like a daunting task, but with our advisors’ help, you can work out a saving plan that suits you. You may have heard about the new Central Bank rules that were introduced last year. As a First Time Buyer, this means you’ll need a deposit of 10% of the value of the property, and 20% deposit for you have had a mortgage previously.
A great way to make sure you’re putting away enough each month towards your savings goal is to set up a standing order. Start by completing a budget of your weekly outgoings to identify any savings you can make. From there, work out what you can realistically manage to save. If needed, your mortgage advisor will be happy to take you through the range of saving options that AIB provides.
4. Applying for a Mortgage
Here’s the really important bit: getting a mortgage means showing that you have the ability to repay it. To get approval, you’ll need to show that you have a regular income, that you’re able to pay your bills, and that you’re saving each month. In order to prove this, you’ll need to provide a few crucial documents:
- 6 months of bank statements for any non-AIB accounts
- Proof of savings for any non-AIB accounts
- 6 months of statements for all non-AIB borrowings i.e. credit cards
- Payslips for the last 3 months
- AIB Salary Certificate signed and stamped by your employer
- Your P60
Once again, your mortgage advisor will be able to take you through exactly what you need.
5. Getting a Sanction in Principle
Don’t be intimidated by the serious-sounding name. A Sanction in Principle is essentially an agreement from your bank that - based on your income, repayment capacity, and deposit - they will give you a mortgage in principle for a certain amount. It’s not a legally binding agreement, but it does give you the confidence to go into the market knowing your mortgage is likely to be approved
6. Making an Offer
Now for the fun part. Once you’ve got your Sanction in Principle, you can start looking for a home in earnest. When house hunting, a good tip is to create a checklist of what you’re looking for in your new home. Take it with you whenever you view a property and make sure each one is up to scratch. And once you’ve found one you really love, it’s time to make an offer and start crossing your fingers.
7. When Your Offer is Accepted
Congratulations, it’s the moment you’ve been waiting for! Once you’ve stopped jumping around the room for joy, there are a few final things to take care of.
A. Firstly, you’ll need to put down a booking deposit. This lets the buyer know your intentions are serious.
B. You’ll then need to provide AIB with your solicitor’s details, property details, and a valuation report before a Letter of Loan can be issued.
8. Signing the Contract for Sale
The Contract for Sale is the binding agreement between you and the seller which sets out the agreed price and planned completion date. Once your solicitor has carried out a few legal checks, you can sign the contract. It’s then returned to the seller, a closing date is agreed, and you’re almost across the finish line.
9. Receiving the loan funds
A few days prior to completion, your solicitor will request the loan funds from the lender and complete the transaction on your behalf. After that, the keys are yours and it’s time to put the kettle on for a well-deserved cup of tea in your new home!
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Allied Irish Banks, p.l.c. is an authorised agent and servicer of AIB Mortgage Bank in relation to origination and servicing of mortgage loans and mortgages. AIB Mortgage Bank and Allied Irish Banks, p.l.c. are regulated by the Central Bank of Ireland.