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buying a new home, selling existing and keep existing morgage

  • 10-08-2015 10:27AM
    #1
    Colonel_McCoy
    Registered Users, Registered Users 2 Posts: 751 ✭✭✭


    I already own a property ( neg equity of course) lets call it Property A and I want to buy another, Property B for a similar price of the property A (current value in neg equity)

    Question is
    Is it possible to sell Property A and buy B while transferring the mortgage From A to Property B.

    For example
    Existing mortgage is 210
    Say property A is sells for 120K
    I buy B for 130K and pay the difference of 10K from savings.

    Can I then transfer the mortgage over from A to B and continue payments?


Comments

  • #2
    seamus
    Registered Users, Registered Users 2 Posts: 68,173 ✭✭✭✭seamus


    Short answer is no, you can never "transfer" your mortgage from one property to another. A mortgage is specific to the property on which it's obtained - once the property is sold, the mortgage is cleared.

    Your mortgage on property B is always a new mortgage on that property.

    However, most banks are offering products that allow you to "bring" your negative equity to the new property.

    What actually happens is this:

    Existing mortgage of €210k.

    Property A sells for €120k.

    You buy property B for €130k (10k deposit). The bank give you a new mortgage of €210k. Of that, €120k goes to the vendors of property B to buy their house, and €90k goes to the bank to clear the mortgage on property A.

    Now, chances are that €90k is just being moved internally in the bank from one account to another, but for the purposes of finances, you are getting a new mortgage for €210k.

    This means that your rates will change, and if you have a tracker you will be paying more. BOI, for example, allow you to keep a tracker rate on the original mortgage amount for five years, but they throw another 1% on it.


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