definition of second home

maw

it is likely that in the next 1-2 years i will need to move for work. Ideally i would like to buy a second home in Dublin and retain my existing in the South West as its ideal as a future holiday home. It is currently in neg equity anyway.

As I would NOT intend to rent out my existing home, how do the banks treat the new mortgage? As an investment (30% deposit max term 25) or as a mover (20% deposit and 35 year term)

payment capacity etc etc is all fine, i just need some advice/experience on the treatment the banks give in this example. are they hard line or is there scope for discussion.

thanks

Michael D Not Higgins

I'm not sure on how this would work. You wouldn't be buying as an investment as it would be your home so you're likely to be 20% deposit. However the negative equity may work against you.

Say for example you have a house worth 100k with 120k on the mortgage.

You want to buy a 300k house in Dublin. This requires a 20% deposit of 60k and a salary of 68.5k.

However, when you add in the negative equity, your total loan to value ratio is 90% and your required salary is 103k.

Negative equity loans are applied when selling the negative equity property and buying somewhere else. I can't see a bank allowed to give the same deal if the negative equity is retained so you might have to comply with the central bank rules on the total amount of mortgage loans.