Loan advice wanted

[witchymand]

A friend of mine needs advice, so I thought I would post on here for her.
She has a 20 year mortgage which will end in 2011, and is currently paying €480 per month, (€18,000 outstanding).
Also has a credit union loan of €5,000 with shares of €2000.
She wants to take a year off to go travelling with her family, and wants to rent her house out which should get €1,500 per month.
She wants to borrow €35,000 over five years, and wants to pay off her mortgage and credit union loan, which then leaves her with €7K plus she will be getting the rent from her house per month.
What would be the best five year loan recommended - i.e credit union, personal loan from bank etc? Or should we just discuss all this with a broker.
All suggestions gratefully appreciated.
Thanks a million

 

[ClubMan]

She wants to borrow €35,000 over five years, and wants to pay off her mortgage and credit union loan

Why on earth does she want to clear a mortgage (at c. 5%) using a presumably unsecured personal loan at most likely a much higher rate!?

which then leaves her with €7K plus she will be getting the rent from her house per month.

€7K p.m.!!? Are you serious? Whatever rental income she is collecting has she accounted for tax?

I suspect that she needs some independent, professional advice before she makes any decisions!

 

[irishpancake]

Why on earth does she want to clear a mortgage (at c. 5%) using a presumably unsecured personal loan at most likely a much higher rate!?

€7K p.m.!!? Are you serious? Whatever rental income she is collecting has she accounted for tax?

I suspect that she needs some independent, professional advice before she makes any decisions!

I think the OP means the €7k would be the nett amount left out of €35k after clearing the CU loan (€3k?) and mortgage (€18k?), plus she would have €1500p.m. rent from the house.

The maths do actually leave me mystified too. [35-(18+3) = 14].

Also, I agree why clear mortgage debt, after 16 years payments with 4 left to go. Surely releasing equity from the house would be the way to go here?

But I do agree, do the figures with an independent professional who can add and subtract.

It's a great position to be in, which should not be thrown away by getting into unnecessary debt.