Sell or Rent???

wanttomove

Registered User
Messages
6
Need some advice please.
Our situation:
Bought in 2004 for €160k, both of us working no children.
Currently have €124k left on mortgage. 2 kids, hubby opened his own business last year which (tip wood) is doing well. I am technically a sahm so currently only 1 income of €28.5k per annum - net of tax and dividend.
The most we could get for our house is €120k which means we are in negative equity. I know it's most definatelty not a lot compared to some. We have never missed a mortgage repayment.
We really want to move from the area we are in as soon as possible for a variety of reasons and so we have 2 options:
1 - rent out our home and rent somewhere else ourselves. Hope that the market rises and sell in a couple of years. This was my initial thought but family/friends think I am mad.
2 - On condition the bank allows, sell our home and take the negative equity with us into a new mortgage and buy another home. I'm just not sure we would be allowed enough of a new mortgage to get the home we want.

Before I go to the bank, does anyone know if:
1. Bank will entertain us taking negative equity into new mortgage
2. How much of a 'new' mortgage we would be allowed (roughly) if at all

btw Mortgage is not with same bank as business and the business is a ltd company with 2 directors 50/50 everything.
 
With one income of €28,500 how can you expect to be able to pay a mortgage?

We're managing fine to pay existing mortgage on 1 income. Never had a problem and I haven't worked in 6 years.

He obviously gets dividend from the business every quarter too so that's in addition to his salary.
 
If he is earning about €28,500 net per year - this would mean a salary of about €36,000 gross (for a PAYE worker, I know it's probably different for him but just giving that as an rough estimate).

If you put your figures into here: https://mortgage.aib.ie/mortgageform/mortgage-calculator you will see you probably won't qualify for a new mortgage with only one earner on around that amount and two dependent children, regardless of negative equity.
 
If he is earning about €28,500 net per year - this would mean a salary of about €36,000 gross (for a PAYE worker, I know it's probably different for him but just giving that as an rough estimate).

If you put your figures into here: you will see you probably won't qualify for a new mortgage with only one earner on around that amount and two dependent children, regardless of negative equity.

Thank you, that's what I was thinking. So that kinda solves our problem.
 
Hi Wanttomove,
you have another option
3. Sell your home, take out personal loan for the negative equity, and rent in the area you want.
Depending on your short term plans, this might be a lower risk option.

Also, my own personal opinion, for what it's worth, and is solely based on the multiple threads here over the years......
Sell your old house. Do not rent it. Renting a house is a business, and one not to be taken on lightly. There appears to be no return in it, even loss making, and it leaves you open to a lot of heartache and hassle (bad tenants, phone calls in the early hours of the morning regarding broken pipes, and from neighbours about unruly tenants). And remember that you would have a €124, mortgage on the property, which would still have to be serviced, even if the property is between tenants.

Based on the number of costs in renting a house (PRTB, maintenance, insurance, mortgage, advertising etc.) it appears to be one of those business's that gains from owning multiple houses. Renting five houses does not equate to 5 times the hassle and costs. Renting one house just doesn't pay.
 
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