Second Mortgage?

E

eamonnbill

Registered User
Messages
10
Hey
Current mortgage 214000
House value 360000
Remaining term 25 years but currently overpaying by 125 a month so just over 20 years left at the minute.
My salary 53k public
Wife 50k public
No kids
Both 30.
Just wondering could we get a second investment mortgage to rent. And if so how much could we get? Do any of ye know?
Thanks
 
Have you scope to enhance your pensions (e.g. notional service purchase, AVCs)?

Probably better to look at tax efficient investing like that first.
 
Yeah put away €900 savings a month but got none. I sort like spending on our cars and stuff. When I got it I spend it. I know having savings would look better but with equity in our house would banks give us anything?
 
What is the mortgage rate on your PPR?

You may well be better off increasing capital repayments on your PPR mortgage, after you have built up a reasonable cash buffer and exhausted any tax efficient pension options.

Leveraged property investments rarely make sense at current yields, RIP mortgage rates and our punitive tax regime.
 
Currently variable 3.5%. I'm also paying in minimum to Avc's which I'll increase soon probably.
 
In my opinion before you start thinking about investing in an investment property, I think you would be better off using any available cash to:

(a) build up a reasonable cash buffer to meet any emergencies that might arise;
(b) max out your AVCs; and
(c) pay down your PPR mortgage.
 
Better to max out the AVCs (but take advice on it as the public sector pension / AVC piece isn't straightforward).

Investment properties are a pain...I wouldn't choose to have one. If I didn't have property exposure and wanted it, I would buy a diversified portfolio of REITs. But only after maxing out our pensions.
 
Gordon Gekko said:
Investment properties are a pain...I wouldn't choose to have one. If I didn't have property exposure and wanted it, I would buy a diversified portfolio of REITs. But only after maxing out our pensions.
Click to expand...

I don't necessarily disagree but the yield on European REITs is now sub-3% - paying down a mortgage @ 3.5% makes a lot more sense, particularly on an after-tax basis.

Point taken re PS AVCs.
 
Sarenco said:
I don't necessarily disagree but the yield on European REITs is now sub-3% - paying down a mortgage @ 3.5% makes a lot more sense, particularly on an after-tax basis.

Point taken re PS AVCs.
Click to expand...

I agree 100%. I wasn't talking about the OP's case. More a general point about someone who wants to obtain exposure to property. The guaranteed pre-tax return of circa 6% that paying a 3.5% mortgage off represents is very attractive in the current environment, especially if it's a KBC one where one could access the overpayments.
 
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