Just looking for some advice here and opinions on what you would do in my situation.
I purchased an apartment with a friend in 2007. Lived there until 2011 when we both moved out and we are now renting the apartment out.
Mortgage balance remaining of 245k. Repayments 870 a month. On a UB tracker. Property worth 140k so about 100k negative equity.
Property costing c.4k a year between us to cover shortfall in mortgage/tax/service charges
Friend is not in a position to purchase the property off me, he is back living in his parents.
I'm now married with kids and the property doesn't suit my needs due to location and size. I am renting a house. We have savings of about €5k.
I am looking at purchasing a new property for c. 320k
Option 1:
Continue to rent and save for a deposit to get a 2nd mortgage with my wife(she would be a FTB). I would need the full 20% deposit of 65k which would be very difficult to save whilst paying rent and would take about 6-7 years. At that stage I would be 40 or so and would only get a 25 year mortgage which would limit amount I could borrow. Who knows what property prices will be like then.
Issues with this option:
Apartment is costing me about €200 a month and is hassle with tenant issues etc.
I will have to wait about 7 years to purchase somewhere - what happens house prices during this time.
Uncertainty in rental market with increase rent/supply of properties/landlords selling up
Advantages
Eventually mortgage will be low say 255k with payments of say 1200.
Option 2.
Get a negative equity mortgage from UB. My friend would come off the mortgage and my wife would take his place. He would pay a contribution of 20k towards the negative equity.
We would be able to get a mortgage of 3.5 times income which would be c. 400k. This would leave us with the ability to purchase a house for €320k.
Issues with this option
80k negative equity/high LTV
Mortgage repayment of c. €1700 for first 5 years and then 1900 a month
Advantages
Get to port tracker + % for first 5 years
Get to buy somewhere now
Any thoughts??
I purchased an apartment with a friend in 2007. Lived there until 2011 when we both moved out and we are now renting the apartment out.
Mortgage balance remaining of 245k. Repayments 870 a month. On a UB tracker. Property worth 140k so about 100k negative equity.
Property costing c.4k a year between us to cover shortfall in mortgage/tax/service charges
Friend is not in a position to purchase the property off me, he is back living in his parents.
I'm now married with kids and the property doesn't suit my needs due to location and size. I am renting a house. We have savings of about €5k.
I am looking at purchasing a new property for c. 320k
Option 1:
Continue to rent and save for a deposit to get a 2nd mortgage with my wife(she would be a FTB). I would need the full 20% deposit of 65k which would be very difficult to save whilst paying rent and would take about 6-7 years. At that stage I would be 40 or so and would only get a 25 year mortgage which would limit amount I could borrow. Who knows what property prices will be like then.
Issues with this option:
Apartment is costing me about €200 a month and is hassle with tenant issues etc.
I will have to wait about 7 years to purchase somewhere - what happens house prices during this time.
Uncertainty in rental market with increase rent/supply of properties/landlords selling up
Advantages
Eventually mortgage will be low say 255k with payments of say 1200.
Option 2.
Get a negative equity mortgage from UB. My friend would come off the mortgage and my wife would take his place. He would pay a contribution of 20k towards the negative equity.
We would be able to get a mortgage of 3.5 times income which would be c. 400k. This would leave us with the ability to purchase a house for €320k.
Issues with this option
80k negative equity/high LTV
Mortgage repayment of c. €1700 for first 5 years and then 1900 a month
Advantages
Get to port tracker + % for first 5 years
Get to buy somewhere now
Any thoughts??