Buying house, using mother's house as collateral

norming09

im looking to buy a house it was 450k and now its 200k. Im living with my mother. If i sold our existing house we would sell it for 160k, however mymother does not want to move, so could i buy it 200k using my mothers house as collatoral or renting my mothers house and my mother move in with me, im looking for advise in relation to this please any advice i can get

delllat

if your mother agrees to move out theres nothing stopping you from renting her house out to help pay another mortgage

if you only wanted to upgrade to the 200k house by selling the 160k house id say ud get a 40k mortgage easy but from you post i undertand you would like to own both houses ?

if thats the case you would need a 200k mortage but it could be offset by both of your salaries and the rent from the 160k house (are you sure you can keep tenants in the 160k house x12 months per year ? )

theres an awful lotta property on the rental market to compete with and you could be struggling to pay the mortgage if the rental income u banked on getting doesnt work out

n900guy

Treehouse72 wrote: »

So if she buys a €200,000 house, it would be c.€5,000 cheaper the month after she bought it (3% minus the rent she paid instead). Over a year that could be a €50,000 saving.

Tell your daughter to rent, observe the falls in the market for another year and then decide what to do.

Even better advice: hang on for 4 years and get the house for free!! 6 years and you have a free house and 100k in the bank!!

This type of advice is what caused the crash in the first place.

ricman

TO get a loan now you need to be in a stable job, you can get free advice from a mortgage broker .THE amount you loan depends on you salary ,plus you need x amount saved up,20 per cent of the house value.
The banks know prices are declining ,they are only giving out a limited amount of mortgages.IF you buy a house now 200k, in a years time ,it,ll probably be worth 150k ,theres an over supply of houses for sale.IS the house in dublin,or outside the city.
Your mother could act as a gaurantor on your loan maybe, i dont think you can use it as collateral,
for your loan, as its owned by your mother,unless you are buying a home as a joint purchase with your ma.

Ste.phen

n900guy wrote: »

Even better advice: hang on for 4 years and get the house for free!! 6 years and you have a free house and 100k in the bank!!

This type of advice is what caused the crash in the first place.

Surely the crash was caused by people a) realising they were spending ridiculous amounts on housing, and b) too much housing

well yes, arguably people approaching the situation with logic and reason is the cause of the crash (see a) above)

ricman

ITS a buyers market, you can compare prices on www.daft.ie ,no agent will refuse a reasonable offer at the moment If you cant get a good deal at the moment you are not looking at enough propertys.
if house x is 200, and identical houses in the area are 150k, house x will not sell, or just bid 150 or lesS.
an agent just does not just think of a random price , he looks at demand,location,transport links,shops, no of houses for sale in the area,condition of the house ,no of rooms,etc before he works out the price.

JuliusCaesar

norming09 wrote: »

im looking to buy a house it was 450k and now its 200k. Im living with my mother. If i sold our existing house we would sell it for 160k, however mymother does not want to move, so could i buy it 200k using my mothers house as collatoral or renting my mothers house and my mother move in with me, im looking for advise in relation to this please any advice i can get

You want your mother to move house against her wishes, so that you can buy a house, using her existing house as collateral???:eek:

dan_d

I'm with Julius Ceasar on this.
I'm sorry OP - what???

Stop for one second.Can you afford a 450k mortgage? I don't care what house you have or what you can sell as collateral. Can YOU afford a 450k mortgage? Or even a 250k mortgage?
Right now our repayments on a 350k mortgage are 1100eur a month (to give an idea).That's with rock-bottom interest rates, which won't stay forever and a mortgage we got some years ago. I can only imagine the current interest rates.

I don't know whether you can or can't use the house, but you need to think a whole lot more about this OP.

ricman

YOU borrow 200k ,you pay 400k back at least,if interest go up by 2 per cent your mortgage goes up by 33per cent per month.IF you buy a house for 300k, in a year it,ll be worth maybe 220k,its a bad time to buy.Stay where you are ,wait and see for another year,prices are still going down.

delllat

dan_d wrote: »

I'm with Julius Ceasar on this.
I'm sorry OP - what???

Stop for one second.Can you afford a 450k mortgage? I don't care what house you have or what you can sell as collateral. Can YOU afford a 450k mortgage? Or even a 250k mortgage?
Right now our repayments on a 350k mortgage are 1100eur a month (to give an idea).That's with rock-bottom interest rates, which won't stay forever and a mortgage we got some years ago. I can only imagine the current interest rates.

I don't know whether you can or can't use the house, but you need to think a whole lot more about this OP.

its not a 450k mortgage,the house in question is 200k

,it wouldnt be impossible for 2 persons to get a 200k mortgage if they have

both jobs
deposit
rental income from another house
the other house to "risk" as collateral

(someone mentioned we are still in the midle of the crash and there is another 25% ging to come off houses by next year -if this is true you will be at a loss of 50k in 12 months with 2 unsecured overvalued properties breezing )

a bank may lend you the cash because its pretty low risk for them imo but they will also take both houses if anything goes wrong and you will owe them whatever

if you lost your jobs or you couldnt find tenants to live in your house you risk losing it all so think carefully before you risk the family home for another one that might be overpriced