Whats involved in remortgaging?

dwayneburke

Hi

I have about 40 months (Over 3 years) paid out of a 25 year mortgage with Ulster Bank. I want to know whats involved in remortgaging my property and spreading the payments over 30 years instead. I am 25 so this should be OK?

I want to get at some of the equity to pay off some small loans,home improvments etc.

I bought the house with the help of my father who is on the mortgage but does not actually contribute. Uptill now i had tenants paying most of the mortgage but my girlfriend and myself want to have the house to ourselves and start a fresh mortgage so we are equal in payments etc.

Can anyone help me with whats involved and if there are any other alternatives?

Also, my partner wants some form of recognition legally that she is contributing to the mortgage (she is not too pushed to be actually on the mortgage itself), is there anything that covers this i.e. deed of interest etc?


Thanks for your help,

Dwayne Burke

dmeehan

if you and your father "sold" the house to you and your girlfriend, then her name would also be on the deeds of the house

talk to your bank, see what they say. it should be no hassle as you have records to show that you were paying the mortgage already for 40 months.

daveg

We remorgaged recently moving from the AIB to the per TSB (as they were cheaper). We had to have the house revalued for the TSB and there were quiet a bit of solicitor involvement to change morgage lenders.

dwayneburke

Was it worth it?

PhilipMarlowe

We re-mortgaged from the ACC (incompetent) to AIB (marginally less incompetent) a couple of years ago.
You will have legal fees and revaluation fees as said - put a squeeze on for the bank to cover half the costs if possible.
I got them to cover £500 for the legal, £100 for the valuation and got free banking for a year.

I did the switch because I was never happy with the ACC at the time of our initial purchase and always vowed to change.
I took the opportunity of increasing the payments and reducing the term (to a 10 year mortgage).

Try not to put your short term loans on the mortgage - it's tempting but you will end up paying way over the odds (like, do you still want to be paying for that TV or whatever when you are 54?). Repay your mortgage as soon as is practical and put the squeeze on yourself to pay off those other borrowings as quick as possible.

edit - Oh yeah, make sure you cover your home insurance if you switch.

uzami

Couple of questions:

1. Do YOU want your girlfriend on the deeds?

2. Do you currently have sufficent single, or joint income (you and girlfriend) to cover the new remortgage. Otherwise your father will remain on both mortgage and deeds

3. There are some attractive 'new business' rates out there (like ptsb for example), but their variable is higher than other banks. look out for this

4. Some banks do 'title deeds insurance' which allows you re-mortgage within a couple of weeks, for a fixed fee (€985). This includes all solicitors fee's, land registery charges and VAT. This also reduces the administration and the hassle of re-mortgaging

5. You should investigate re-mortgaging every 3 years to avail of 'new business products' (re-mortgage more frequently and the banks will be reluctant to take you on).

6. If remortgaging try and keep the same term (eg 22 years) otherwise you will have wasted 3 years worth of payments because of the amoritisation of an interest based loan (in other words, you've hardly paid any of the principle over 3 years), though cash is cheap at the moment, so lengthen the term ONLY if you are willing to make lump sum payments against your mortgage. In other words reduce the principle while interest rates are low, as opposed to making reduced monthly payments that are barely making a scratch on the principle

7. With regard to girlfriend on the mortgage/deeds, be careful. What % of ownership does she want. if she contributes to 50% of the mortgage, will she expect 50% of the house? You have substantial equity built up in the house, be careful. You can draft a seperate legal agreement, away from the deeds and you should take legal advice on this. It may cost you money now, but it could potentially save you €'000's.

8. Quick example. if the house is worth €250k, and the remortgage is for €150,000, and you are going to split the re-mortgage, what does she take legal ownership of?
If she is jointly on the mortgage she will have to be on the deeds. because she can't be jointly responsible for half the debt without being able to borrow on the asset of the house (which she has to have some legal entitlement to).

So if you split up she can insist that you sell the house so she can 'realise' her legal entitlement. What has she invested in the house? What is she willing to make as a downpayment?

If she wants legal recognition of what she is contributing to the house, keep receipts. If the house increases in value from the day she starts to contribute to the mortgage, then she can share in the additional equity from that day in equal proportion to her contributions.

nahdoic

That's some good advice uzami. It sounds like you've been burned before ...

uzami

That's some good advice uzami. It sounds like you've been burned before ...

ah you know......it hasn't happened to me, but I have met/know other people who have been shafted, and trust me you want to get this sorted and in black and white, as love tends to colour these decisions

dwayneburke

Uzami,
Thanks a million, will def. take advice on board

daveg

Originally posted by dwayneburke
Was it worth it?

To be honest it was all about cash. Basically AIB throw out were the lowest APR which is c0ck because it's cost per thousand you should look at as thats what will determine what you pay at the end of the day. Check EZHome.ie for current cost per €1K - (Excellent site... you can calculate repayments ect)

We re-mortgaged from the ACC (incompetent) to AIB (marginally less incompetent) a couple of years ago.You will have legal fees and revaluation fees as said - put a squeeze on for the bank to cover half the costs if possible.
I got them to cover £500 for the legal, £100 for the valuation and got free banking for a year.

Doh... I wish Id known that when we remorgaged :rolleyes: