# Could I re-finance my mortgage?



## finoblad (21 Oct 2008)

I’m considering re-financing my mortgage and not too sure if its viable, perhaps the sum is too low or the current financial climate etc, I am not sure and would appreciate any advice.

My house [2008 price adjusted] value is 325k, the outstanding balance on my mortgage is 43k over the next 6 years [approx 670 euro per month] 

I am looking to re-finance over 10 years and add an extra 17k for some home improvements etc.

My only other outgoings are
a car loan with 14k left to pay over the next three years.
i’ve no credit card bill
childcare costs of 1,000 per month

My cash flow is a bit too tight to take on another short term loan and I think I would rather re-finance the mortgage if possible.

Can anyone offer an opinion?
Would it be straightforward to re-finance?
Would there be a lot of fees to pay?

Thanks


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## NorfBank (21 Oct 2008)

What's your salary?
What interest rate are you on at the moment? Tracker/Variable/Fixed?
How much are the monthly car loan repayments?


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## finoblad (21 Oct 2008)

Salary is 58k + 28k
Variable Rate 5.94%
Car Loan is 460 per month

Thanks


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## NorfBank (21 Oct 2008)

finoblad said:


> Can anyone offer an opinion?
> Would it be straightforward to re-finance?
> Would there be a lot of fees to pay?



I'm sure many people on here will offer you an opinion on loan consolidation. I will stick to your other 2 questions.

It will be straightforward looking at your income and your current outgoings.
There will be legal fees of about €1000.
You will need to increase your mortgage protection or life cover.
There will be a valuation fee of €130.
You will also get a better variable rate than you are currently on at about 5.40%.


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## finoblad (22 Oct 2008)

Thanks for the reply, I will get researching so.


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## finoblad (31 Oct 2008)

Does anyone know if I can re-finance this without affecting my Mortgage Interest Relief?


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## Bob_tg (1 Nov 2008)

Have you considered alternative shorter term loan financing, e.g. credit union?

You have to be careful when addressing 'home improvements'.  What is the nature of these improvements?  Are they to (1) address wear and tear or (2) add extra features to your house which would either help hold or improve value over the long run?  

If (1) above, then I would recommend short term finance.  If (2), then there could be justification in looking at the mortgage.

The thing you have to be careful of is going back to the mortgage pot every few years and thereby erode the asset value.  As NorfBank points out there are set-up/transaction costs in upping your mortage.  Even if you intended to pay off the mortage early, this could wipe out any perceived interest rate advantage.


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## finoblad (1 Nov 2008)

The improvements wont add much value to the house.

I have looked at short term loans but I have an eye on my cash flow and don't want to have any difficulty.

I'm curious about the mortgage interest relief and if I will cause a problem


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## bond-007 (1 Nov 2008)

You have to reapply for mortgage interest relief all over again and wait 2 to 3 months for it to be processed. 
It does not affect first time buyer status.


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## Jonathan.OB (3 Nov 2008)

I'm surprised your having cash-flow issues with that salary. 

Nonetheless, a few questions might put this in better light. 

What is your age, if you don't mind me asking. 

Have you had credit problems in the past, where you may have missed payments on borrowings or perhaps have had credit cards revoked? (You probably haven't it's just easier to confirm) 

The variable rate of 5.94% seems quite reasonable and with the ECB expecting to cut interest rates in the coming weeks, you may even save on your interest repayments. 

Jon


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## finoblad (6 Nov 2008)

Jon, I'm 41 and no credit problems.
I've cut back on a lot of expenditure but my cash flow is still a worry for me.


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