One owner may move abroad

[dyhfhtm]

Hey all - looking for advice on behalf of my friend - the story is as follows:

- House bought for €390k in 2006
- Current market value - lucky to get €190k
- Still owe about €320k
- BOI 35 year: after 2 year fixed they moved to tracker - great.
- The house was purchased by friend & their partner with a 60% / 40% liability split due to the difference in income at time of mortgage

Cut to 2013 and one of the couple has had employment difficulty, their employer is going from month to month at this stage with redundancy likely any day now. A full time permanent opportunity has arisen in Amsterdam for this person, but they are worried about the impact on their tracker.

They are a proud couple and have worked hard to make sure that their bills and mortgage have NEVER fallen behind by even one payment. However, if she loses her job this will not be sustainable.

Main question would be - if she (40% liability) was to move to Amsterdam to work, but the boyfriend (60% liability) remains at home as an owner occupier - will there be implications on their tracker?

They absolutely want to pay their mortgage in full, but if they lose the tracker due to her moving for work then this will become extremely difficult, especially as accommodation must be paid for abroad too. If she stays here, she may lose her job anyhow at which point payment will be near impossible.

I feel for them - it really seems like the system is not set to help people who really want to continue to pay in full but may have trying circumstances.

Thanks!

 

[Joe_90]

If they continue to pay the mortgage and it's owner occupied I don't see that there is any issue. Why would they tell the bank anything?

 

[dyhfhtm]

I believe the main reason is due to having tax sorted here before the move happens. My friend had a great amount of shares from employment/investment back in 2007 which resulted in a tax bill in March of this year. That was all paid and cleared in full....but if a move happened in the next few weeks she should be eligible for a sizable tax rebate which frankly, will be needed to get her on her feet in new city. If she claims tax rebate she's worried somehow her moving aboard can be communicated back to the bank via revenue - which won't bode well if she does not bring it up. Essentially, the house will still be owner occupied by the person who owns 60% of the debt, and it will still be her residence every chance she gets to return home.

 

[ontour]

There is no reason for the bank to be concerned that one person is working outside the country. The loan is being repaid so the bank has no reason to be looking in to your friends. If they are on a relationship, I am guessing that the person will be coming 'home' frequently.

It is interesting the way that you refer to 60% and 40% liability. If they are joint borrowers, they are usually joint and severally responsible - the bank can come after each party for 100%.

 

[dyhfhtm]

Thanks Ontour. Yes I know from a legal perspective that they are both 100% accountable for the full value - it's just what agreed come sale time - they pay 60/40 and the take any value 60/40....not that that's likely to happen.

It sounds like she is in a good position. Absolutely paying the mortgage will remain priority no.1 each month. I wonder if Revenue cancel her interest tax relief will this cause the bank to look in to why.

 

[jaykayphd]

Thanks Ontour. Yes I know from a legal perspective that they are both 100% accountable for the full value - it's just what agreed come sale time - they pay 60/40 and the take any value 60/40....not that that's likely to happen.

It sounds like she is in a good position. Absolutely paying the mortgage will remain priority no.1 each month. I wonder if Revenue cancel her interest tax relief will this cause the bank to look in to why.

As stated above, there will be no problems once mortgage is paid.

I emigrated 18 months ago and cancelled my mortgage tax relief with the revenue. The other owner of the property remained in the property. Mortgage is paid, bank is happy, no problems.