Condensing 2 mortgages into one

[mcfly]

Hi,
Myself and my mother both have properties mortgaged.Recently I discovered that if we used the value of one property to pay off the other we would be paying approx €300 less a month and would subsequently own one property outright.I am looking for what kind of mortgage company to go with in this situation.Any advice out there?

 

[Satanta]

we would be paying approx €300 less a month and would subsequently own one property outright

Can't answer the real original question, but felt it worth commenting...

You may be paying €300 less per month, but what will the total cost of the change be over the term of the mortgage? Is the saving per month worth the (potential) additional cost (e.g. do you need the extra cash)?

I'd suggest seeking professional advice on a move as (potentially) complicated as this. If not done in the correct manner it may have serious complications down the line (tax issues/ownership issues etc etc).

 

[mcfly]

Yeah see your point but who do you get such sound advice from as I dont particularily trust advice from mortgage companies as they are obviously out to suit themselves.With regard to ownership issues it wont be a problem we are 50/50 on this and I cant really see any tax issues can anyone else?

 

[Satanta]

who do you get such sound advice from as I dont particularily trust advice from mortgage companies as they are obviously out to suit themselves.

Fully agree, don't take advice from anyone with a vested interest in your actions.

In this case I'd certainly speak with a solicitor to investigate the legal side (even with family things can and do go wrong). A talk with a tax expert (FA/accountant) may help identify the most cost effective way forward.

I cant really see any tax issues can anyone else?

Well, it depends on how the situation is dealt with. If one party "gifts" the money to pay off the mortgage on one of the properties then the CAT thresholds would have to be considered (depends on how large the amount in question is and which way the gift is going - different thresholds depending on the relationship).

Dealing with this as one party buying into the property of the other would have far higher costs (SD, CGT etc) so I can't see that as being the way to go... can't actually think of any cost effective method apart from the gift, but I'm sure there are numerous options.

Again, for something like this I'd certainly be seeking advice.... so I'm far from in a position to be able to advise anyone else!

 

[mcfly]

Yeah thanks for that advice further advice will be sought I reckon, before moving on this