Complicated and confused - Tracker from 2007 still in NE

[Hunter]

We bought a property in Wicklow in 2007 (BOI tracker€420k) and we bought a holiday home in Clare in 2009 (EBS variable €105k a non liveable renovation project for the future).

By 2011 the Wicklow property was worth €210 and I took a €20k hit on salary . We also had two kids along the way.
In 2015 we moved to Clare in the hope of renovating the house and living here full time.
We are renting ourselves at present and pay €850 per month .
We hope to remortgage the EBS mortgage to do renovation works and make this our family home. It needs about €200k works.
We have rented out the property in Wicklow and that brings in €1200 in rent and we pay the extra €200 towards the mortgage.

Last week we were told our tenants are leaving the end of Feb so we are seriously thinking of selling this property as it is holding us back starting the renovation work.
We were told this week that it should go on the market for €340, the outstanding mortgage is €336. We are very happy to break even if this is the reality.

However we are really confused as we are hearing so much about trackers and deals etc
Are we unwise just to let the tracker go ?
I have asked about carrying it but I'm told it may or may not be possible as we are not a straightforward case ( we would have to switch EBS mortgage and then apply for renovation costs on top of that).

Would we be wise to hold out another year and maybe gain a profit however small???
We would remain paying rent however as the other house is not liveable in present state.

Also I have asked if it's possible for a moratorium or interest only on the BOI mortgage while our tenants are out and it's up for sale but I've been refused the moratorium and I've been told if I apply for interest only they may take the tracker off us as its not our primary residence.
Can they do this , should I risk applying?
Also would interest only application be seen as a bad credit rating for future re mortgage application?

Sorry about all the questions but awfully confused.
Also have no savings or investments so really want to make the right decision this time considering it went all so wrong the last time !

 

[delfio]

You bought at the peak in 2007, that was tough. What I don't understand is why you went on to buy a further property in 2009 in what was then a rapidly falling market.

 

[PGF2016]

My opinion would be that someone with 2 mortgages and no savings should be looking to reduce debt/risk and not take on more.

 

[elcato]

and I've been told if I apply for interest only they may take the tracker off us as its not our primary residence

Who told you this ? BOI or someone in the pub ? Where do your current statements from the mortgage go to ?

 

[RedOnion]

Hi,

You'd need to check your original Mortgage contract with BoI, but it was pretty standard condition that house had to remain your PPR to keep tracker.

BoI have a tracker mover option. It's usually for people trading up / down. I'm not sure if they'd allow you to use it to remortgage a property you already own though. They add 1% to your current rate, and you keep tracker for 5 years. You'll find details on their website, but you'd need to ask if it's possible.

I'm assuming your tax position on the rental house is up to date?

Don't underestimate the cost of selling - solicitor fees and legal fees mainly, but the house might need a few little jobs done to help sell that might need some cashflow.

A bit left field, but 200k seems a lot for a renovation in Clare, unless it's a complete rebuild. Would it be cheaper to sell it, and buy a house that meets your needs?

 

[llgon]

You would need to post more information about your property in Clare and its mortgage, along with your income to get advice on remortgaging it. Unless you have a lot of equity in it I think your chances of remortgaging it are slim, without any savings. As RedOnion suggested maybe selling it might be a better option and use any equity to buy another house, to which you may be able to transfer your tracker.

I'd be inclined to try and sell the Wicklow property ASAP, any reduction in property prices could be disastrous for you. Holding on to it in the hope of making a small profit next year would be a big gamble.