Can I get a negative equity mortgage if my current mortgage is with Danske Bank?

[Pete78]

My current mortgage is in negative equity (Balance 220k / Property worth 180k)

We are hoping to move to a new home worth approx 280k.

We have a deposit saved of 75k. Salary is 85k p.a. (my wife does not work).

Based on the central bank rules we should qualify got a negative equity mortgage as (a) we have the 20% deposit for new property and (b) our total remaining borrowing would be less than 3.5 times salary.

However our current mortgage is with Danske who have left the market. Will any of the remaining banks consider us to a negative equity mortgage? Or will have to continue saving until I can cover the existing negative equity and pay 20% deposit for new property i.e save an extra 20k approx.

Thanks

 

[Brendan Burgess]

Will any of the remaining banks consider us to a negative equity mortgage?

After the trade up, your position would be:

Home €280k
Mortgage €280k
+negative equity: €40k
Less deposit: €75k
Total borrowing: €245k
Loan to value: 87%
Loan to Income: 2.0 times

So you would not be in negative equity. Or have I got my figures wrong?

The Central Bank rules do not apply to you as you are in negative equity.

So I think that the lenders will apply their own criteria so they probably would give you a mortgage.

Do you have a cheap tracker with Danske Bank? If so, it will be very expensive to trade up.

Brendan

 

[Pete78]

Hi Brendan, perhaps I phrased my post badly. My current mortgage is in negative equity but the final position would be exactly per you numbers above.

I do have a cheap tracker that I would hate to lose but we need to move to a bigger home. One option would be to keep and rent out my current property but that would put my total borrowings above the Central Bank limits.

Thanks for the reply.

 

[Butter]

I sacrificed my Danske 0.5% tracker to move house earlier this year. We're now paying 3.6% with KBC. It wasn't in NE. Sometimes I think it was a crazy financial move and then I look around the house & despite the extra cost I'm glad we did it.
The Danske tracker is valuable for sure, but shouldn't be a set of handcuffs for life.