Trading up and keeping PPR as investment

O

Once Bitten

Guest
Current PPR value 250k. Mortgage 120k.

Looking at new situation as follows.
New PPR value 350k. Mortgage 270k. Expect tracker rates of 3.1%
Current PPR re-classified as investment. Refinance up to 200k. => investment LTV=80%. Gross rental income 750pm.

Not sure what mortgage rates would apply on investment.

With new values at 350+250 and new mortgages at 270+200, combined income (2 applicants) of 82k, do you see us qualifying?
 
Yep,
You will have no hassles qualifying
Your rates might be a little off - can get you 2.95% for PPR, and 3.1% for your investment property
Munsterdude
(Broker)
 
Do bear in mind that you will only be able to offset the interest on the original €120,000 against the rental income - not the interest on the additional €80,000 as this money is not being used to "buy, improve or renovate" the property.

Sarah

www.rea.ie
 
"not the interest on the additional €80,000 as this money is not being used to "buy, improve or renovate" the property."

Does this mean that if a person uses the equity release or part thereof to improve the home for rental purposes that the interest on this money(used for renovating) can be offset against rental income. I am thinking of doing something similar myself and have done renovations to the house and was wondering if i could do this.

Thanks,
Sully.
 
tax relief

Sarah,

I had asked that very question on the Property Investment forum, but no-one awake on that side of the fence. Your answer is as expected/hoped !

Thx.
 
Re: tax relief

You asked less than 15 hours ago. It seems a bit premature to accuse people of sleeping on the (voluntary) job... :|
 
Re: tax relief

If you had observed the posting guidelines re duplication of posts instead of being such a smartass perhaps you would have fared better :(
 
smart ass and duplicate posts

I am aware of the posting guidelines and did not duplicate any posts. Go check.

I had two related but distinct questions.
1) relating to interest rates and qualifying for mortgage (PPR and investment)
2) relating to offsetting rental income

Posted Q1 on the other forum (which subsequently got moved to here) and Q2 here (where it remains).

Turns out that both questions were answered in the other forum.

I considered it adhering to the spirit of posting guidelines to ask focused questions in the right place rather than combining the two in one post.
--------------------------
As regards being a smart ass, my comment was intended as a compliment for Sarah for anticipating the 2nd question, rather than being a slur on readers/posters on this forum. I accept it was offensive, for which I unreservedly apologise.
 
ck to the underlying topic

If I may ask a question to clarify the response in relation to offsetting rental income in the case of refinancing ...

If the refinancing of the PPR mortgage (120k) up to 200k is done using a fresh mortgage with a different lender, rather than being an 80k top-up with the current lender, does that change the response.

In that case, can I still offset rental income against interest on
a) the original 120k,
b) zero (seeing as none of the new mortgage was used to buy the property)
c) all of the new 200k (unlikely)
 
Re: ck to the underlying topic

If the refinancing of the PPR mortgage (120k) up to 200k is done using a fresh mortgage with a different lender, rather than being an 80k top-up with the current lender, does that change the response.
Click to expand...

You will be able to offset the interest on the €120k against any rental income

Strictly speaking refinancing is not covered by any tax legislation and on that basis it would not be allowed
(refinancing is not for the purchase, construction or improvement of a property)

However, it is common practice and revenue do allow you to refinance a loan but will only allow interest on the amount that was outstanding before re-financing

[email protected]
 
Silence from Fintan & Clubman

Are you guys prepared to eat Humble Pie?
 
Disregard last post..............TYPO


Silence from Tommy & Clubman

Are you guys prepared to eat Humble Pie?
 
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