So this time last year we commenced a switch of our mortgage from BOI variable 3.3% to EBS 1yr fixed term 2.9% taking advantage of the 2% cashback. Switch took ages and was finally completed in mid December. I had anticipated that we would switch again or do a multiple switch and was going to be getting the paperwork ready around now to be ready to switch as soon as the fixed term ended, however our personal circumstances are due to change a lot in the next 1-2 months.
current circumstances:
Mortgage: 280,000 balance , term left 24 years. House value 515,000
Myself Age 40: self employed - gross annual income 140,000 euro
Husband age 43- public sector - gross annual income 50000 euro approx (net 33,000 euro)
Children: 6y, 5y, 2y, 1y
Pension myself: max contributions to PRSA every year
Husband- public sector pension- deducted from payslip
Income protection - both have it in place
Term life insurance in place instead of mortgage protection.
Death in service benefit: husband
Work insurance policy pays 180,000 to husband on my death while still working.
Debts- none
Savings - 30K
Credit card and cars fully paid
However we are both essential workers and have struggled with childcare during the pandemic. After long discussions and doing some figures we could see that all of my husbands take home pay has been going to pay the childminder, we have decided that my husband will take some time out and mind the kids for a few years (1 -5 yrs) . If it’s a disaster after 1 yr he will return to work and we will have to find childminder, if a success he would like to get the 4th child to primary school and if he wishes, return to work then.
We are both savers and recently discussed our mortgage and would really like to reduce the term to 15 years. With my job I am in the position to increase my income by approx 20,000 per annum and will potentially have the occasional bonus in addition to that. Our ultimate goal is to try and pay the mortgage off in 5 years which may be pie in the sky but we really anxious to pursue it.
My questions are:
- will his giving up his job scupper our ability to switch mortgage in that we won’t meet the stress test or will the reduction in childminder fees offset his loss in income as regards the stress test?
- any other things we’ve missed out when considering him stopping working financial disadvantages e.g his lost pension contributions and loss of death in service benefit while not working, or advantages?
- any tips or advice on us pursuing our goal of aggressively paying down our mortgage? If we are approved for a switch, what would be the best approach in terms of reducing the term, fixing or not keeping in mind our goal of aggressively overpaying.
We are realistic that it will require sacrifices on our part but we do still intend having fun and enjoying this time with our kids but I naively/optimistically think it’s possible. Would welcome any advice or thoughts on our situation. Thanks
current circumstances:
Mortgage: 280,000 balance , term left 24 years. House value 515,000
Myself Age 40: self employed - gross annual income 140,000 euro
Husband age 43- public sector - gross annual income 50000 euro approx (net 33,000 euro)
Children: 6y, 5y, 2y, 1y
Pension myself: max contributions to PRSA every year
Husband- public sector pension- deducted from payslip
Income protection - both have it in place
Term life insurance in place instead of mortgage protection.
Death in service benefit: husband
Work insurance policy pays 180,000 to husband on my death while still working.
Debts- none
Savings - 30K
Credit card and cars fully paid
However we are both essential workers and have struggled with childcare during the pandemic. After long discussions and doing some figures we could see that all of my husbands take home pay has been going to pay the childminder, we have decided that my husband will take some time out and mind the kids for a few years (1 -5 yrs) . If it’s a disaster after 1 yr he will return to work and we will have to find childminder, if a success he would like to get the 4th child to primary school and if he wishes, return to work then.
We are both savers and recently discussed our mortgage and would really like to reduce the term to 15 years. With my job I am in the position to increase my income by approx 20,000 per annum and will potentially have the occasional bonus in addition to that. Our ultimate goal is to try and pay the mortgage off in 5 years which may be pie in the sky but we really anxious to pursue it.
My questions are:
- will his giving up his job scupper our ability to switch mortgage in that we won’t meet the stress test or will the reduction in childminder fees offset his loss in income as regards the stress test?
- any other things we’ve missed out when considering him stopping working financial disadvantages e.g his lost pension contributions and loss of death in service benefit while not working, or advantages?
- any tips or advice on us pursuing our goal of aggressively paying down our mortgage? If we are approved for a switch, what would be the best approach in terms of reducing the term, fixing or not keeping in mind our goal of aggressively overpaying.
We are realistic that it will require sacrifices on our part but we do still intend having fun and enjoying this time with our kids but I naively/optimistically think it’s possible. Would welcome any advice or thoughts on our situation. Thanks