Topping up FTB Mortgage - Interest relief

C

CorkGuy12

Registered User
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Hi all,

I got my FTB Mortgage about 2 years ago (2010) - it's small at the moment, but I intend doing a lot of work on the house. I've engaged an architect, and we're looking at costs of ~€100k for a full refurbishment. My mortgage will essentially double once I get it approved (I expect to be approved... stable job, good history)

I'm already getting mortgage interest relief on the existing mortgage, but how will the top up fit in?

I've looked at [broken link removed], but it's not entirely clear to me, especially with the new rules.

I guess my most pressing question is, do I need to have my top-up approved and drawn down prior to December 31st to attract tax relief, or if I wait until the new year to finalise my plans am I forgoing any tax relief on the top up?

Thanks!
 
Hi all,

I got an answer from revenue. If I top up before December 31st, it would just be considered year 3 of my FTB mortgage, and hence attract relief until 2017. However, if I top up in 2013, it will attract no relief at all.

The way I see it, if I top up by 100k prior to 31st Dec, at 4%, for 20 years, the relief will be approx:
Year: interest @ rate = relief

2013: €3928 @22.5% = 883
2014: €3792 @22.5% = 853
2015: €3650 @20.0% = 730
2016: €3502 @20.0% = 700
2017: €3349 @15.0% = 502

So a total relief of about €3670. Are those figures correct?

So, what do you think? Should I go full steam ahead, finalise my plans ASAP, get costings, and try to get approval, and draw down before 31st Dec, or should I take my time, work with the tenders, and do it right? I'm leaning towards the latter when I look at the actual relief versus the cost of my project.
 
Timod -- Not sure if you'll be able to draw down anyway until each stage is complete.
 
You won't be able to draw down the lot initially, will be lucky to be able to draw down anything before some work is completed. I would say it is even tight enough with the way the banks are processing applications to get approval and draw down of first stage payment this side of Christmas anyway bearing in mind most banks have a cut of date for drawdowns on the run up to Christmas which is near mid month so realistically you only 6 weeks or so to sort the lot out.
 
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