1st home on fixed mortgage, now what to do with investment property

R

russell6

Guest
I currently own my first house worth 300K with mortgage 175K. I have a 2 year fixed rate of 3.39% - I have just finished year one of this rate.

I would like to buy my first investment property, in the range 280K. I have 20K cash available. From reading this site I realise the best thing to do is maximise my loan for the investment property and use the cash to pay off my first mortgage. However the fact I am in a fixed mortgage is complicating things!
-Should i put the cash towards the first mortgage and take the hit on the exit fees and lose a good interest rate
-Should i put the cash into the new mortgage, forget about 1st mortgage
-Should I forget the whole idea for a year and leave the 20K invested (equity SSIA)

thanks
 
Well you probably need a bit more cash to cover 8-10% on the investment property mortgage, legal fees, and around €14k in stamp duty, so I'd say that you need to take another look at the sums.

It certainly doesn't make sense to cash in your SSIA now and lose out on the Government bonus.

Are you happy that property is the right choice at this point in time?
 
Don't worry, not losing out of Government contribution, SSIA has matured since September
 
Between SD and deposit you'll need €42,000 plus legal costs, furniture, etc, etc. You do have equity in your home so you could relese some of this but it will depend on your income, the likely rental income and any other loans you might have.

Sarah

www.rea.ie
 
You must log in or register to reply here.
Back
Top