# Are KBC offering Split Mortgages or medium term reduced payments?



## Sean2303 (30 Jul 2013)

Hi All

Does anyone know if KBC are offering Split Mortgages or medium term reduced payments?

We have completed SFRS and are waiting to hear back from them. Due to childcare costs (3 Kids in Afterschool and Creche) we need to reduce mortgage payment to cover interest and a small portion of capital. We would either like to do this for 5 years and then ramp back up when significant funds become available again or split mortgage off and then take back into consideration again in 5 years.


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## Brendan Burgess (1 Aug 2013)

It doesn't look like it

 [broken link removed].

We have a number of alternative repayment arrangements that we can look at, depending on your circumstances.  These arrangements include:
1. Paying interest and part of the normal capital payment for a specified   time.
2. Paying interest only for a specified time.
3.     Extending    your    mortgage    over    a    longer    term,    which    will    reduce    the    
 amount of your monthly repayment.
4. Capitalising arrears – adding arrears to the loan and repaying them       over    an    agreed    period.
5. Deferring part or all of your mortgage repayment for a specified    period of time.
6.     Changing    the    type    of    your    mortgage,    for    example    from    a    fixed    rate    to    
     a    variable    rate.        It    is    important    to    note    that    a    fixed    rate    break    funding    
 fee may apply.


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## FutEng (2 Aug 2013)

Just yesterday my partner got another letter of variation from them...

It offers 'a less than interest only' agreement where the costs of the running the property are deducted from the gross rent and they get the net.

Again its delaying the inevitable in my partners case as the mortgage is unsustainable in the long term and these short term 'fixes' is can kicking in the extreme. 

She has offered to sell the property but they don't appear to be interested. It was a PPR when she bought it but it was converted to an investment in 2009 when she moved into my house.


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## Brendan Burgess (2 Aug 2013)

Hi FutEng

I hate the expression "kicking the can down the road". Most of the time it's meaningless as it is in this case. 

KBC are making a commercially sensible decision

Should I keep or sell this investment property in negative equity?


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## Sean2303 (2 Aug 2013)

Brendan Burgess said:


> 1. Paying interest and part of the normal capital payment for a specified time.


 
Thanks Brendan, option 1 would be ideal if the specified time was a couple of years. We can afford Interest only and some capital just not the full repayment at this stage. As I said things will change when Creche Fees are reduced substantially so they may look at this option for us.


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## Brendan Burgess (2 Aug 2013)

Hi Sean

This would seem like a practical solution for you. You need a 5 year solution and not a full term solution. 

So you need temporarily reduced payments and not a split mortgage.

But unfortunately the public discussion deems all sorts of temporary solutions as "extend and pretend" and "kicking the can down the road" which makes the Central Bank disapprove of these type of solutions.

See what KBC comes back with and then fill in the Case Study format if you need further advice.


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## demoivre (2 Aug 2013)

I know of one case with KBC where the borrower enquired about a split mortgage and was advised to submit a SFS and the borrower's suitability for such a product would be considered. Haven't spoken to the guy since so I don't know the outcome.


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