Mortgage for self build - have we any hope?

just do it

My OH and I both bought properties in '04 before we met. Unfortunately both are now in negative equity probably to the tune of €120-150k combined. They are both rented and we are making full repayments. We are looking to build hopefully starting this summer and are preparing to go to the banks to see will they lend.

We have savings of ~€40k and looking at a build cost of ~€250k. We are currently saving €1k a month after everything else is covered.

So folks, whats your thoughts?

kkelliher

just do it wrote: »

My OH and I both bought properties in '04 before we met. Unfortunately both are now in negative equity probably to the tune of €120-150k combined. They are both rented and we are making full repayments. We are looking to build hopefully starting this summer and are preparing to go to the banks to see will they lend.

We have savings of ~€40k and looking at a build cost of ~€250k. We are currently saving €1k a month after everything else is covered.

So folks, whats your thoughts?

If you already own the land you have done chance but if not i would not fancy your chances

DAT64

First step is your income multiple. Multiply your combined gross salaries by roughly 4.5 that will give you a figure of a mortgage that your salaries can carry. Then deduct your combined existing mtgs, that will give you an idea of how much your are able to apply for.
If you own the site than you can borrow 90% of the cost of construction + site value. Not including outlays and 10% contingency fund.
Thats if you pass step one above.
After that it comes down to affordability to carry all the mtgs.
Hope that helps.

just do it

DAT64 wrote: »

First step is your income multiple. Multiply your combined gross salaries by roughly 4.5 that will give you a figure of a mortgage that your salaries can carry. Then deduct your combined existing mtgs, that will give you an idea of how much your are able to apply for.
If you own the site than you can borrow 90% of the cost of construction + site value. Not including outlays and 10% contingency fund.
Thats if you pass step one above.
After that it comes down to affordability to carry all the mtgs.
Hope that helps.

Great stuff, on those criteria they'll lend us enough to build a dog kennel!

PadraigQ

just do it wrote: »

Great stuff, on those criteria they'll lend us enough to build a dog kennel!

choose a method that doesn't require a mortgage.. 40k is plenty for a palace. i'd PM you but don't have enough posts.