Want to buy a second house but no deposit

weemarie

I'm just wondering if anyone can offer any advice.
We own a very small house. We have no mortgage just a personal loan which will be paid off in 7 years. We need to buy a bigger house but don't have the 10% deposit for a mortgage.
I know that they don't let you use the property as the deposit anymore so is there any other way except for selling the house? Is it possible to get a mortgage on it now and use that for a second home or anything?

Thanks so much

BrokenArrows

weemarie wrote: »

I'm just wondering if anyone can offer any advice.
We own a very small house. We have no mortgage just a personal loan which will be paid off in 7 years. We need to buy a bigger house but don't have the 10% deposit for a mortgage.
I know that they don't let you use the property as the deposit anymore so is there any other way except for selling the house? Is it possible to get a mortgage on it now and use that for a second home or anything?

Thanks so much

The obvious questions:

Will you be able to afford to repay two mortgages for 7 years? Since you haven't been able to save enough of a deposit then you probably cant.
What do you plan to do with the second home? Rent?

You will have to speak to your bank to see if they can remortgage a portion of your current property for the deposit on the second.

weemarie

BrokenArrows wrote: »

The obvious questions:

Will you be able to afford to repay two mortgages for 7 years? Since you haven't been able to save enough of a deposit then you probably cant.
What do you plan to do with the second home? Rent?

You will have to speak to your bank to see if they can remortgage a portion of your current property for the deposit on the second.

We are planning on renting the current house and should have no problem door so.
Ok thanks for your advice

Glass fused light

Do you know your expected return in your investment and how much can you afford to loose if you have to evict a tenant?

snickerpuss

If you are not a first time buyer it's 20%.

weemarie

Yes we have worked it out and can definitely afford the two.

weemarie

We looked into this but because we didn't get a mortgage the first time we are still considered first time buyers and only need the 10%

punisher5112

Extend ?

weemarie

This was our initial plan and we looked into it but it's a semi detached and there's no entry into the back garden so it would end up being very tough if possible at all. Thank you for your advice though.

I think I already knew there's no simple solution but I thought it was worth asking

BrokenArrows

weemarie wrote: »

This was our initial plan and we looked into it but it's a semi detached and there's no entry into the back garden so it would end up being very tough if possible at all. Thank you for your advice though.

I think I already knew there's no simple solution but I thought it was worth asking

The easiest thing to do would be to speak to a mortgage advisor. They will be able to give you your options.

daheff

weemarie wrote: »

We have no mortgage just a personal loan which will be paid off in 7 years.

can i ask why a personal loan instead of a mortgage? Surely the interest on a personal loan is circa 10% vs 3-4% for a mortgage?



anyways, would it not be better to remortgage your current property, releasing some equity (ie cash deposit) and use that to buy the second property?

sealgaire

weemarie wrote: »

We looked into this but because we didn't get a mortgage the first time we are still considered first time buyers and only need the 10%

Mortgage or not, you're not a first time buyer


EDIT: Eating humble pie here!
http://www.centralbank.ie/press-area/press-releases/Documents/CP87%20Information%20Note.pdf

I never knew that!