Advice Needed - Will we get another Mortgage

celtp

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We are relocating in the Autumn for DH's work. We currently have two properties - family home and investment property. Our gross salaries are approx 140K. We have 225K left on family home and 82K on investment property. Family home is in a great rental area and we should be able to rent it all year round and cover the mortgage.

We would like to buy a family home when we relocate. What are the chances of a bank giving us a 3rd mortgage? Both investment properties would fund themselves through rental. We have had the 1st investment property for 11 years and have a rental track record. We also have some savings to cover mortgage payments should the properties be empty for any time.

Is this just a pipe dream or would a bank consider giving us a mortgage?

All advice appreciated.

Many thanks
 
I think a Bank would consider giving you a third mortgage, but it would depend on how much you are looking to buy for/borrow. The max LTV will be 92%. Ideally the Bank will want you to cover the balance of 8% + stamp duty from your own funds/savings, but might consider funding some/all of it by releasing equity from existing property. Will very much depend on overall strength of application, i.e. sustainability of income/employment, bank account operation, etc. You should make an application through a broker to find out what your options are.
 
Bear in mind you are going to get hit with stamp duty as well, so on the basis you will need 8-10% deposit, you will need €50k+ available before you even consider this
 
Are you mental?, I think you are in deep enough really
What if new location/job etc,. doesnt work out then you are stuck with a third property, if i were you I would rent in the new area and sit tight for a while, things could still get a lot worse.
Houses are taking forever to sell at the moment so take this into account if you need to sell in an emegency.
 
Thanks for the replies. Moving closer to Dublin so that there is more jobs on offer - not just one.
 
Banks are hesitant to lend to prospective clients who have more than one property already.

A client of mine was in a very similar position to you, had a strong income, both current properties would have been rented out and covered by rent by 125%, yet they declined on the basis that he would have to be able to fund the repayments on the rented properties if they were to be vacant for a period of 6 months or greater at one time.

It's all going to hinge on your disposable income, the money you have left over after paying off all monthly financial commitments.

Have you considered location and price range for your new home in Dublin? If so, how much are you looking to borrow?

Another aspect that the banks will assess is your 'financial personality'. Generally, you have to be seen to be 'financially fit' - that is have a good track record of savings, a substanstial rainy day fund and for you not to be in any way reliant on credit cards, or short term borrowings to fund monthly excesses.

You have a strong joint income, and provided you match the above profile, you have a better chance than most.

Best of luck!

J
 
Thanks Jonathan.OB

We are moving to North Wexford and are looking for a 5 bed house. There are some great deals out there at the moment, that's what is tempting us to buy. Really don't want to rent as it will unsettle the kids even further. We do have savings, no credit card debit or loans apart from the mortgages. Our current family home is in a great location and could be rented all year round, with peak rates in the summer.

If we were to sell our family home I don't think we would recoup our investment as we only bought 6 years ago. Also no houses selling especially at the upper end of the market.

Will hang on until September and discuss then with our bank manager.

Thanks again for the advice.
 
celtp...have you a post also in money makeover forum?,..it says you have no salary and just partner on 80k, not the 140k above...same celtp??..if yes, looks like you have a lot of spare equity so could see bank offering a mortgage alright... but do you need the hangover of another mortgage in current climate?
 
celtp,

if you know what you're getting into, then it would be more probable to get another mortgage by using a good broker, unless you are good at developing business cases yourself. I can recommend a good broker that could help you if you want to pm me
 
Hi Huggie

We are a community board. Why not post your very good broker on site so that everybody can benefit?

Marion
 
We are in a similar position regarding mortgage/moving. We own a house currently rented for past 4 years - only 1 month without a tenant - this we own outright. We have interest only loan on our home - for about 50% of the (current) value of the house. The rental income more than covers the mort. & insurance costs. We have seen a house we like cost approx 400,000 including stamp duty - we would like to borrow 300,000 over 10 years as we have 100,000 in cash. The reason being that we think it's crazy to try & sell either of the properties in the current climate but would do so in a couple of years time. Our home would be easy to rent even in the current financial climate. Our joint income is approx. €75,000 we have no other loans. Any suggestions as to who is giving interest only loans - if anyone at the moment. I just checked with Halifax & they are not doing them at all! Advice welcome.
 
... There are some great deals out there at the moment, that's what is tempting us to buy.

They are only great deals if you compare them to past prices, but what if house prices fall by another 10, 20 or 40%? You'd then be stuck with another house you cannot sell if you have to.
 
Hi there, I posted on the Money Make over board. With a new baby due in Sept my other half is thinking about not going back to work. Can't see it happening though and wanted to see how the finances would fair out.

Thanks for your comments.

Celtp
 
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