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Merging loan with mortgage

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  • 05-08-2014 8:53pm
    #1
    dar100
    Registered Users Posts: 1,735 ✭✭✭


    Hi,

    I am wondering if it is possible to do the above?

    I have two smallish loans, one with the bank I got the mortgage with, and another with the Credit Union.

    I have just recently drawn down the mortgage, and have not yet made my first payment, as I am on a three month monitourium.

    Any advice or feedback on the process, pro/con ??


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    #2
    coylemj
    Registered Users Posts: 25,437 ✭✭✭✭coylemj


    Unless the other loans were for capital projects like a new bathroom or extension, I would not merge them into the mortgage. It's a trap a lot of people fall into - take a loan they got for a car, a holiday or to pay off a credit card bill and bundle it into the mortgage, then pay it off over 20 years so they are paying for something long after it's been consumed.

    In your case the mortgage (as a legal contract) would need to be redone which would incur legal fees, I wouldn't do it. Pay off those other loans within the timeframe originally intended.


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    #3
    SBarrett
    Registered Users Posts: 160 ✭✭SBarrett


    It is possible to do. The LTV will have to remain under the lenders maximum.

    As Coylemj said, it will be more expensive in the long run as you will be paying interest over a longer period. It will however, reduce your monthly outgoings.

    If you just got the mortgage, why didn't you ask the lender if you could do it when applying for the mortgage? The bank would have known about these loans and you would have had enough disposable income after stressed tested mortgage repayments and these loans, so has something changed or are you just a little tight on cash?


    Steven


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    #4
    dar100
    Registered Users Posts: 1,735 ✭✭✭dar100


    SBarrett wrote: »
    It is possible to do. The LTV will have to remain under the lenders maximum.

    As Coylemj said, it will be more expensive in the long run as you will be paying interest over a longer period. It will however, reduce your monthly outgoings.

    If you just got the mortgage, why didn't you ask the lender if you could do it when applying for the mortgage? The bank would have known about these loans and you would have had enough disposable income after stressed tested mortgage repayments and these loans, so has something changed or are you just a little tight on cash?


    Steven[/QU

    Nothing has changed, just looking for a little extra cash monthly.

    Will manage without it, not paying legal fee's and such to get it


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