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Negative equity question

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  • 17-07-2012 7:45pm
    #1
    roozer
    Registered Users Posts: 35 ✭


    I am in a fair amount of negative equity and we are thinking of applying for a negative equity mortgage to transfer the NE and get a bigger house for our ever expanding family.
    Friends of ours were in a similiar situation and got such a deal so we think we may get it too as we earn more and are in less NE.

    It would mean selling our house at potentially the bottom of the market and locking in the negative equity loss.
    We married 5 years ago but we are not jointly assessed for PAYE so never bothered telling bank or revenue basically because there would be no benefit in our situation.

    The mortgage is in my name only. Instead of a NE mortgage would it be possible for my wife to get a mortgage out in her name only where we could rent out or other house instead of selling with the hope that the value may rise again thus reducing the amount of NE.

    Not sure if that is even possible, would the fact that my wife is married to me mean she would not be offered a mortgage on her own?


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    #2
    killers1
    Registered Users Posts: 1,443 ✭✭✭killers1


    roozer wrote: »
    I am in a fair amount of negative equity and we are thinking of applying for a negative equity mortgage to transfer the NE and get a bigger house for our ever expanding family.
    Friends of ours were in a similiar situation and got such a deal so we think we may get it too as we earn more and are in less NE.

    It would mean selling our house at potentially the bottom of the market and locking in the negative equity loss.
    We married 5 years ago but we are not jointly assessed for PAYE so never bothered telling bank or revenue basically because there would be no benefit in our situation.

    The mortgage is in my name only. Instead of a NE mortgage would it be possible for my wife to get a mortgage out in her name only where we could rent out or other house instead of selling with the hope that the value may rise again thus reducing the amount of NE.

    Not sure if that is even possible, would the fact that my wife is married to me mean she would not be offered a mortgage on her own?

    Even though you have a property in negative equity it doesn't automatically mean you won't qualify for a new joint mortgage to purchase a new home & retain existing property to be rented out. You would need to have sufficient incomes to qualify for combined mortgage totals and also have a proven repayment capacity for the combined stressed repayments on both mortgages to qualify & meet the banks criteria without a reliance on rental income


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    #3
    Funnyonion79
    Registered Users Posts: 569 ✭✭✭Funnyonion79


    Hi, we are also in negative equity and have been approved for a mortgage on a bigger house - whilst being able to rent out our existing property.

    AIB refused us a mortgage unless we were willing to sell our existing property, however BOI approved us.

    We hope to close in the next 4 weeks and plan to rent out our existing property then.


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    #4
    frosty66
    Registered Users Posts: 46 ✭frosty66


    funnyonion.. do u mind me asking how much negative equity u are in?and value of the new mortgage you got?

    we would like to buy a 2nd house whilst retaining our n/e current property..


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    #5
    Funnyonion79
    Registered Users Posts: 569 ✭✭✭Funnyonion79


    frosty66 wrote: »
    funnyonion.. do u mind me asking how much negative equity u are in?and value of the new mortgage you got?

    we would like to buy a 2nd house whilst retaining our n/e current property..

    Hi Frosty,

    We're bases in Dublin and I'd say we're in NE by about €50k as we bought in 2005 just before prices went really crazy.

    Our new mortgage is for €207k.

    Best of luck!


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    #6
    Chicke
    Registered Users Posts: 107 ✭✭Chicke


    Were thinking of considering this but we arnt sure do the bank need huge incomes from the applicants.Sorry for the question but would you have to have a huge income that would cover both the new mortgage and also the entire rental income
    thanks a mill


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    #7
    Funnyonion79
    Registered Users Posts: 569 ✭✭✭Funnyonion79


    Chicke wrote: »
    Were thinking of considering this but we arnt sure do the bank need huge incomes from the applicants.Sorry for the question but would you have to have a huge income that would cover both the new mortgage and also the entire rental income
    thanks a mill

    I'm a public sector worker earning 37k and hubby is private sector earning 60k guaranteed plus 10k bonus (not guaranteed).

    If you have a good savings history it's well worth going for mortgage approval, but our broker originally told us not to come near him unless we had about a 10% deposit saved, plus stamp duty and solicitors fees.

    Even with all that, we ended up having to get a 9k "gift" off my parents at the last minute to please BOI, as "they like to see a bit of extra money there as well to do up the house with".

    So save save save and go for it!


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