The Top 6 mortgage questions answered by a mortgage expert

If you’re buying your first home, you probably have a lot of questions. You’ll have questions about the mortgage process. You may even be wondering to yourself: “How do I get a mortgage? Are my finances as ship shape as they should be?”

There’s paperwork, budgeting, and legal requirements – not to mention the new Central Bank Rules which were introduced in 2015. There’s also all that mortgage jargon to swallow (like knowing your LTV from your APR).

Here are the top six questions AIB Mortgage Advisors are regularly asked by First Time Buyers.

1. Who determines if I can get a mortgage?

Your mortgage advisor’s job is to help you get everything in order for your application. At your first meeting your advisor will go through your application to make sure you have all the information you need and the right documentation. The advisor then completes the application and sends it on to the lender, who will make the decision whether or not it is accepted.

2. How does the new Central Bank Rule affect me as a First Time Buyer?

This may seem like a tricky one for those who are only starting out. As a First Time Buyer, you can apply for a up to 90% Loan-To-Value mortgage up to €220,000, above this amount 80% loan to value is available (which means 80% of the remaining balance). Does the mortgage advisor or lender have any influence on the kind of house I buy?

Don’t worry - the mortgage advisor won’t help you pick the curtains. Your lender will just need to be reassured you will be able to meet your repayments. They will also make sure that you’re paying a fair price for your new home is worth. That’s why you need a Valuer’s Report.

3. What’s the difference between a Fixed Rate mortgage and a Variable Rate mortgage?

With a Standard variable and a loan to Value rate mortgage your interest rate can go up as well as down This offers you the flexibility to make early or lump sum repayments and so reduce the overall cost of your mortgage. There is also the option of changing to a Fixed rate at any time. With a fixed rate you can expect the same rate for a specified period, AIB can offer fixed rate options from 1 year to 5 years . Some people prefer the fixed mortgage, because it means they know exactly how much they need to pay each month (which makes saving for holidays and other things a lot easier). While Fixed Rates offer certainty of repayments and protect you from interest rate increases they also mean you will not benefit from any rate cuts that occur during the fixed period chosen. Neither will you have the flexibility to switch out of the Fixed Rate without potentially incurring a breakage cost. Here’s more information about AIB’s mortgage rate options.

4. What is 12 months approval and why do home buyers need it so much?

Before you start house-hunting, it’s important to get mortgage approval from your lender. AIB offers 12 months approval so you have lots of time to find the perfect house.

5. How can I apply for my mortgage?

You don’t necessarily need to go to branch if it doesn’t suit you. You can apply online, and if you need any help, we will talk you through the process on the phone or on our online chat.

Other loose-end mortgage questions tied up

For those a little perplexed by the phrase ‘Gazumping’: it may sound like great fun, but disappointedly, it describes a situation where there are home-buyers arguing over the same house. Also, there is definitely a T in mortgage, even though it’s a silent one.

That clears up some of the pressing questions and downright curious issues that First Time Buyers have if not click here for more information about your First Time Buyer Mortgage. If you have any queries of your own, no matter how big or small, why not check out our FAQs, or make an appointment with an AIB mortgage advisor?

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.