Mortgage advice please, thanks

Rosey Red

Hi all,

I would love if somebody could shed some light on our options of getting a mortgage at the mo. I have seen lots of sound advice here, particularly from killers?, so would appreciate if you could read on, thanks.

- We are in negative equity (possibly sell our home for approx 125,000)
- owe 220,000 on current mortgage
- mortgage is tracker
- both in permanent employment
- never had car loan / credit card etc, so mortgage is only loan
- have savings of 60,000
- net pay between us is approx 4,700 per month
- have 2 children (childcare will be about 1,500 per month from next year)

Anybody any idea? We obviously need to trade up but if absolutely necessary we would consider to extend (if we got a small mortgage and use our savings).

Ok guys, i'm open to any opinions, so feel free......

Thanks
RR

Trish56

Rosey Red, You may be able to get a Negative Equity Mortgage however that depends on the lender you are with at the moment.
Trish56

Rosey Red wrote: »

Hi all,

I would love if somebody could shed some light on our options of getting a mortgage at the mo. I have seen lots of sound advice here, particularly from killers?, so would appreciate if you could read on, thanks.

- We are in negative equity (possibly sell our home for approx 125,000)
- owe 220,000 on current mortgage
- mortgage is tracker
- both in permanent employment
- never had car loan / credit card etc, so mortgage is only loan
- have savings of 60,000
- net pay between us is approx 4,700 per month
- have 2 children (childcare will be about 1,500 per month from next year)

Anybody any idea? We obviously need to trade up but if absolutely necessary we would consider to extend (if we got a small mortgage and use our savings).

Ok guys, i'm open to any opinions, so feel free......

Thanks
RR

The_Conductor

Permanent TSB, BOI and AIB all advertise negative equity mortgages- specifically to enable people trade up to a larger property- such as you're proposing.

A few pointers- typically the maximum mortgage they will advance will be 92% of the value of the new property- inclusive of any negative equity you're bringing across, and subject to a maximum repayment of typically 35% of your net monthly income- across all repayments. (Obviously rules and how they are applied will vary from lender to lender- but they're not going to make this overly easy for you).

Its more theoretical than fact though- to the end of June, according to Central Bank figures- there have been only 310 negative equity mortgages approved in the country- thats 310 in total- across all lenders.

Sit down with an independent financial advisor and get their opinion as to the best course of action for you.

Rosey Red

Thanks trish and the conductor -

current mortgage is with danske bank (national irish). We have looked at renting out our house and renting elsewhere but it is not an option. The rent we would get here would not cover our mortgage and we would also have a significant shortfall on the new rental, not to mention the tax.

The urgency lies in that we will be facing school soon and would preferably be sending our children to school in a different area. This area is fine/not great for us but not one where we ever envisaged our kids would begin school.

So, is there anybody able to do a rough calculation of our facts and figures in relation to getting a mortgage before we approach any banks / financial advisors? Would really appreciate it, thanks.
Wouldn't it be great if so many people didn't have these worries hanging over them
RR

gaius c

Look for Killers here on boards. He's a mortgage broker and very helpful. May be able to give you some pointers/answers.

Trish56

Rosey Red,
You need to contact National Irish bank to see if they offer negative equity trade up mortgages. Most lenders do for existing customers only however they all have different criteria i.e AIB will lend up to max. 175%( max. loan 700k) of the new property subject of course to conditions whilst KBC will only lend up to 125% (max. loan 550k). Your childcare expenses will not be a great help in looking for a new mortgage as majority of lenders treat it as a loan. Your best hope is to contact your lender.
Best of luck.


QUOTE=Rosey Red;86801773]Thanks trish and the conductor -

current mortgage is with danske bank (national irish). We have looked at renting out our house and renting elsewhere but it is not an option. The rent we would get here would not cover our mortgage and we would also have a significant shortfall on the new rental, not to mention the tax.

The urgency lies in that we will be facing school soon and would preferably be sending our children to school in a different area. This area is fine/not great for us but not one where we ever envisaged our kids would begin school.

So, is there anybody able to do a rough calculation of our facts and figures in relation to getting a mortgage before we approach any banks / financial advisors? Would really appreciate it, thanks.
Wouldn't it be great if so many people didn't have these worries hanging over them
RR[/QUOTE]

the groutch

just remember that you'll lose any mortgage interest relief, and almost certainly lose your tracker rate, so moving could be an expensive option.

Rosey Red

Yes, they are also factors to consider. Our trs goes straight back into our savings but the loss of a tracker rate would potentially have a much bigger impact.

RR