Mortgage or Loan??

Dustyman

Registered User
Messages
38
Firstly moderator feel free to move this thread. Not exactly sure where it should go.

Situation:
We want to build our own house. We have a site and cash of on hand (yes we are thankful).
However we will still need approximately E40,000 to complete the house. Not a big house
I am the principle earner but although in good health now my health history is not great. Therefore I may have difficulty obtaining mortgage protection or may have to pay a very high premium. Although I do have life insurance (got when I worked in Australia. It is a an Australia policy). Its part of a superannuation policy I have there when I was working there. It's up to date.

What are my options? Could I just simply build the house to a certain stage with the money I have and maybe apply to the credit union for a 'home improvement loan'? Just wondering.
Any advice greatly appreciated.
Thanking you in advance.

SL
 

Brendan Burgess

Founder
Messages
38,685
You should apply for a much larger mortgage than you need from one of the cash back lenders.

Collect your 2% cash back.

If the life insurance is too expensive, the lender can waive the requirement. They might or might not do this.

Or take out the life insurance anyway and just pay the premium.

Finish the building work.

Repay all the cash that you don't need. You will keep the 2% cash back.

Take out a new life policy for the smaller amount and cancel the old policy.

Pay off the mortgage as quickly as possible and cancel the life policy.

Brendan
 

Dustyman

Registered User
Messages
38
You should apply for a much larger mortgage than you need from one of the cash back lenders.

Collect your 2% cash back.

If the life insurance is too expensive, the lender can waive the requirement. They might or might not do this.

Or take out the life insurance anyway and just pay the premium.

Finish the building work.

Repay all the cash that you don't need. You will keep the 2% cash back.

Take out a new life policy for the smaller amount and cancel the old policy.

Pay off the mortgage as quickly as possible and cancel the life policy.

Brendan
Brendan, thank you. Much appreciated.
 

Dustyman

Registered User
Messages
38
Noting in life is straightforward!

My life Insurance (from Australia where I worked for a period) is only valued at E35,000.
Bank of Ireland have got back to us and said (when I asked for a waiver on the mortgage protection and told them I would legally assign my life assurance to them as an alternative):


"referred this over to the life team & they stated that the underwriter would have to make the decision on this as the decision lies with the mortgage provider. If the policy (life insurance) that you hold is not based in Ireland then it is probably not able to be assigned to an institution"
BOI


I do have a death in service gratuity with my employer if that is of any help?

Also we have deiced not to buy a new house but build instead (as we have our own site). Of course planning has to be approved first.
We're thinking of asking the bank for E35,000 over 10 years instead? As well feel we would need this amount to fully completer the house. As already stated we have a fair bit of cash on hand (relatively speaking).
It would be a good house (not a huge house by any means) on a 4 1/2 acre site if and when it get's built.

Any thoughts?
 

Brendan Burgess

Founder
Messages
38,685
Have you applied for mortgage protection insurance from an Irish company?

That is the first thing to do to see how much it costs.

You might be able to keep the cost down by keeping to just 10 years.

Brendan
 

Dustyman

Registered User
Messages
38
Have you applied for mortgage protection insurance from an Irish company?

That is the first thing to do to see how much it costs.

You might be able to keep the cost down by keeping to just 10 years.

Brendan
Hi Brendan,

Thanks again for reply.

No not yet and yes that is true.

Although I have good health now my health history is not great.
I've approached Lion.ie who reckon I could be a 'complicated application' giving my health history.

I've also approached a company in the UK, Pulse Insurance, who provide mortgage protection for Ireland too.
So waiting for feedback from them also.
 

EmmDee

Registered User
Messages
227
Hi Brendan,

Thanks again for reply.

No not yet and yes that is true.

Although I have good health now my health history is not great.
I've approached Lion.ie who reckon I could be a 'complicated application' giving my health history.

I've also approached a company in the UK, Pulse Insurance, who provide mortgage protection for Ireland too.
So waiting for feedback from them also.
Just be careful when enquiring that it is not seen as a formal application/enquiry and you don't get "declined" or a "refusal to quote". Once that happens you have to declare it on every future application and it can cause issues.

Lesson learned the hard way on another type of insurance
 

Dustyman

Registered User
Messages
38
Thanks Liam

I had not heard of them.

I see that they seem to specialise in people with illnesses.

Brendan
Yes, apparently they (Lion.ie) do and I may go with them if the Bank's don't offer a waiver on the Mortgage Protection (some do apparently).

Pulse insurance (located in Uk) did provide mortgage protection to Irish resident's but now due to the uncertainty surrounding Brexit they do not.
 
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