Home economics: Answering your property questions
Personal Finance expert Sinead Ryan answers your property questions.
Q. My girlfriend and I are anxious to buy a house and settle down. We have been saving for a deposit and want to avail of the new tax rebate. While her financial history is exemplary, I'm afraid mine is not. I had a court judgement issued against me a couple of years ago for an unpaid fine (€600 plus costs) and I had my bank chase me over a car loan I couldn't pay because I lost my job. I'm in a good job now and only have a small credit card debt, which I pay every month. Should I just not say anything?
A. Avoiding your credit history won't be an option. When you apply for a mortgage, lenders generally check your credit rating through a pooled organisation which the banks fund called the Irish Credit Bureau. This tracks any past lending (and, more importantly, missed or defaulted payments) for individuals and it can date back a number of years.
Typically, they will ask for two years' worth of credit checks and this may be enough to pick up the issues you have mentioned. They can go further back if they wish, so my advice would be twofold. Firstly, get a sense of your own credit rating first - you are entitled to see what the banks know about you and it costs just €6 from icb.ie. You will get a quite lengthy form (it looks more complicated than it is with the jargon on it) and study it carefully.The website has an FAQ explaining the figures, but for loans three months or more in arrears, this will be flagged by a score of '50' (typical scores rate from 271-850 in different categories). If a loan has been written off, or is pending litigation, a 'W' or 'P' will be returned. If there's anything on it that is no longer true, the original creditor can apply to have it updated.
I would then be upfront with the bank, stressing your current good record. Better still, you might want to employ the services of a mortgage broker. It will cost around €500 but they know the lenders better disposed to poorer credit histories. There are quite a few, like Pepper for example, who are happy to lend to people like you.
Q. I'm renting a house with two friends. We're all in our 30s and we do like to spend money on ourselves, so we have really nice stuff which we share like laptops, designer clothes and some nice jewellery. We all work in good jobs and are out during the day. We had an attempted break-in last week, although nothing was taken as they were scared off by a neighbour. Our landlord tells us the insurance he has on the property is sufficient, but how do we know? Is it possible to get a policy ourselves?
A. Yes, it is. In fact, it's vital. Firstly, ask the landlord for a copy of the home contents policy, so you can see for yourselves. It's important that the rental is noted, as a claim may not be supported if the insurer thinks the landlord lives there themselves.
You have amassed lots of valuables so it is important to have them covered. Jonathan Hehir of insuremyhouse.ie says, "According to the latest Residential Tenancy Board (RTB) figures, there are over 700,000 people in private rented accommodation and, given the current property market, many of these are likely to be there for the foreseeable future.
"While previously, renting had been viewed as the preserve of students and younger workers, we are seeing a greater shift in the profile of people renting, but the proportion taking out home insurance doesn't appear to match the profile of those in rental accommodation.
"Less than 10pc of home insurance policies taken with us are to tenants. Those who have a greater exposure to content risk are leaving themselves open to a huge financial shock if they do not have the necessary cover in place."
You can expect to pay between €100 and €150 per annum for contents up to €15,000 but do shop around and get some quotes.
The Ryan Review
With a possible Fine Gael upheaval in the offing - or worse, a general election around the corner - we can expect all TDs to go into self-employed role for the next few weeks (months?).
And considering that the Minister for Housing, Simon Coveney, is one of the front-runners for leadership, what now for his progressive and somewhat brave policies regarding social housing, new constructions and homelessness?
Each time a change at the top happens, there follows an inevitable winding-down period followed by a learning-curve period, with the consequence of delays, obfuscations and possibly a radical change to policy as a new Minister tries to make their own mark rather than be hamstrung by someone else's decision.
There's no doubt that for a while housing was the new 'Angola' (to which Brian Cowan once so memorably compared the Department of Health) but things appear to be finally moving, albeit at snail's pace.
Would it be too much to ask that Fine Gael grassroots leave Simon where he is while they argue among themselves?