Hi all!
I am in the following situation and was looking for some input....
I inherited a property in Dublin a year ago that is worth approximately €500k; I now live in that property.
I wish to hold on to the property but want to use it as collateral or to release equity from it to fund a buy-to-let mortgage on a newly purchased second property in Dublin.
I had a quick chat with a large Irish bank about this and they were pretty unhelpful and alluded to "lessons they learned from the past" regarding releasing equity to fund a BtL!!
I was approaching it from a (relatively) limited risk situation, whereby I would:
The entire portfolio would have:
Does anybody have experience of this type of arrangement and how best I might proceed?
(I understand the various risks involved and am comfortable with the risk profile.)
Thank you!
Debaser.
I am in the following situation and was looking for some input....
I inherited a property in Dublin a year ago that is worth approximately €500k; I now live in that property.
I wish to hold on to the property but want to use it as collateral or to release equity from it to fund a buy-to-let mortgage on a newly purchased second property in Dublin.
I had a quick chat with a large Irish bank about this and they were pretty unhelpful and alluded to "lessons they learned from the past" regarding releasing equity to fund a BtL!!
I was approaching it from a (relatively) limited risk situation, whereby I would:
- Release approximately €150k in equity from my PPR (c. 30% LTV);
- Add approx €30k in cash;
- Then borrow c. €320k to fund a new €500k BtL purchase (c. 64% LTV).
The entire portfolio would have:
- Debt of c. €470k against value of c. €1,000k;
- Full P&I mortgage repayments of 20yr term at 5% would be c. €3,100 p/m;
- Interest only repayments would be c. €1.958;
- Rental income on both properties, at 100% occupancy, would be c. €5,700 p/m;
- 75% of the €320k mortgage interest would be tax deductible (approx. €1,125);
- With my own income providing a buffer on top of that at around €4,500 p/m (net)
Does anybody have experience of this type of arrangement and how best I might proceed?
(I understand the various risks involved and am comfortable with the risk profile.)
Thank you!
Debaser.