Looking to trade up

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deedee80

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Hi there

Myself and my husband have a mortagage of 450 and have about 150k equity in our home. We have seen a house we would like to buy for 600. We could do this using the equity and still having a mortgage of 450. We have a combined salary of 105k so under the 3.5% rule we wouldnt qualify for 450. How strict is this? Is it possible to stay with our bank with the same loan amount just on a different property. We are paying the mortgage so have proved we can afford it.

TIA
 
The banks can grant a certain percentage exemptions. However, I know at least one bank stopped granting loan to income exemptions as they had exceeded the CBI limit.

Is your current mortgage a tracker?
 
deedee80 said:
Hi there

Myself and my husband have a mortagage of 450 and have about 150k equity in our home. We have seen a house we would like to buy for 600. We could do this using the equity and still having a mortgage of 450. We have a combined salary of 105k so under the 3.5% rule we wouldnt qualify for 450. How strict is this? Is it possible to stay with our bank with the same loan amount just on a different property. We are paying the mortgage so have proved we can afford it.

TIA
Click to expand...
Most of the banks have closed exceptions to the loan to income (LTI) limit. PTSB are still offering them but on quite a restricted basis, whereby they increased the required percentage of disposable income left over to a much higher level than previously required (there is no negotiation on this point - applicants either qualify or they don't). Some of the the other banks may open up exceptions at some stage, but they tend not to give much notice, and there is so much pent-up demand that they are not likely to stay open for long. Failing that, the banks will most likely open up exceptions for 2019 in around Oct/Nov this year, provided the mortgage does not draw down in 2018.

Your own bank would have to treat this as a new mortgage, so they would need to have availability of LTI exceptions. As RedOnion mentioned, if you have a tracker that you can move, you would want to keep that, of course.

Best regards,
Dave Curry CFP®
https://www.linkedin.com/in/davecurryirl
 
Your age and No of children would be taken into account. It's possible this has changed since you were first granted the mortgage you have now.
 
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