No. You would end up paying the same amount of interest irrespective of whether it's a new Mortgage or existing.For simplicity say prices remained static and I bought a simlarly priced place in Galway. Would I end up paying more in a new mortgage than if i transferred my current mortgage?
Thanks Easel.
This is going to sound like a really stupid question but i'll ask anyway.
When I took out my mortgage first I was paying an enourmous amount of the interest in the first few years. The banks front load interest payments.
The last couple of years (I'm 9 years into my mortgage) I've finally started to clear some larger chunks off the capital.
If I was to sell and start again with a new mortgage would I end up front loading interest again?
For simplicity say prices remained static and I bought a simlarly priced place in Galway. Would I end up paying more in a new mortgage than if i transferred my current mortgage?
No. You would end up paying the same amount of interest irrespective of whether it's a new Mortgage or existing.
It's not correct to think interest is 'front loaded' - it's charged on the remaining balance, but because your balance is bigger at the start the interest charged is higher (plus in your case rates were higher).
The speed at which you pay capital is mainly determined by the mortgage term.
If it was me I would sell and not go through the hassle of becoming a landlord for a year if it is your intension to buy in Galway at that point.
I can't see this. The risk of a significant increase in property prices between buying and selling is too great. And by risk I mean the damage to your position that would be caused by a big increase, rather than how likely that is.
If prices went up you too much might be unable to buy again. For that reason I wouldn't sell until I was ready to buy.
If you really don't want to be a landlord you don't have to rent out the Dublin property. If it were me I would sleep on a sofa in Galway for a year rather than be out of property for year.
It its not about which way you will be better off, its about which way gives you less risk.
I think this would be mad. To pay €12k in mortgage repayments and a possible service charge for up to 12 months while sleeping on a couch just to stay exposed to property. Starting a job in a new location is hard enough without not having your own space. You would need property prices to increase by over 5% in the next year for this to be profitable..
Am I not correct in thinking that you will be liable for capital gains tax if house value goes over price you bought it for?
Thanks for the input Catherine. I find it very interesting the amount of accidental landlords who all seem to say I'd be better off selling up.As an accidental landlord myself I would personally sell up take the money and continue saving you will be in a better situation to buy when you see the right property and you will have no chain to worry about.
The only reason I became an accidental landlord was because my house was in negative equity. Thankfully it is out of that and putting it up for sale.
Am I not correct in thinking that you will be liable for capital gains tax if house value goes over price you bought it for?
Thanks for the suggestion Laramie but I'm not overly interested in becoming a landlord longterm anyway. Plus I'd need the deposit from the sale to purchase a new property.Have you thought about keeping your Dublin property with the rental income covering the present mortgage repayments. Then purchasing a second property in Galway and using the additional rental income from your first property to partly fund your repayments on your new second property?
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