Mortgage hopefuls need to clear debt and save

As 100% mortgages are long gone for most would-be property buyers, the focus is firmly back on saving a deposit for a mortgage. If you’re finding your disposable income tight while trying to save, or are looking for ways to clear other debts or an overdraft, perhaps it’s time to put on your thinking cap and see what items you can sell on DoneDeal. Liquidate your assets In banking terms, (if you’re looking for fancy terminology) you could say that selling unwanted, unused or valuable personal items is simply liquidating your assets. Advertising and selling items on DoneDeal can play a significant part in improving how you look on paper for the bank. You can use the cash generated to clear credit card debt, save for your deposit, or clear an existing loan. Mortgage requirements Karl Deeter, Compliance Manager with Irish Mortgage Brokers, spoke to DoneDeal about what’s required nowadays for a mortgage. “If you have a credit card debt you have to have that cleared,” he says. If you can clear it using money from selling personal items so be it. “The idea of having savings and not having loans are some of the top things to consider,” he adds. It’s also important that you’re not living beyond your means, so you don’t want to be in overdraft either. According to Karl, you have to have a very transparent set of bank accounts when applying for a mortgage, as the person making the decision may never even talk to you. Financial institutions are able to identify what’s going on in your life from the money coming in to and going out of your account and all transactions on your credit card. Show me the money “You need to be able to prove what you’re doing with your money,” says Karl. So, if you’re paying your parents money for living at home, that needs to appear as rent on your bank statement. You also need to exert self-control and save money in your own named account, rather than giving cash to your mother to lodge into her credit union account. “Any cash transaction goes into the ether,” says Karl, “unless there’s solid proof of that happening.” If you’ve liquidated some of your assets, as mentioned above, you need to make it as easy as possible for a lender to see where that money came from. One way to do this is to take screenshots of your ads on DoneDeal and keep a copy of all receipts you give to buyers. “People have assets. Make it something that’s easily auditable,” advises Karl. “I would advise people don’t purchase extravagant things, for example a €5k purchase, or buying a car, it just makes banks ask more questions.” You can read 11 mortgage tips from Karl on the Irish Mortgage Brokers blog. How to get started If you’re looking for ideas on how to raise capital to clear an overdraft, personal loan, credit card debt or to pump into savings, you can read some of our previous articles on how to make money from DoneDeal on the Make Money section on our blog. We also have a range of articles on the basics of DoneDealing, safety and general tips for sellers. #Finances #Property #Renting