3.5 x salary limit with jointly owned property

D

Dublin Divorce

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I have a property jointly owned with my ex husband. About 120k in Negative equity so stuck just now. Rented and a lot of the rent being counted against interest so holding its own.
Outstanding mortgage: 600k
My salary:85k
I am looking to get a joint mortgage with my new partner. 3.5 times his salary more than covers what we need, but as the new property will be in joint names it will have to be a joint mortgage.
Does anyone know the rules around salary to mortgage limit in this case? Does the whole value of my current mortgage count against my salary or just 50%?
 
Brendan Burgess said:
Why does he not buy the property on his own?
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I would have thought that (strategically) this is a much better option.


Legally, if you are in a committed relationship (and especially if paying part of mortgage) you are building up entitlements to the property anyway in event of relationship breakdown or passing away. If you marry then it essentially becomes moot.
 
Are you sure you are still in negative equity? From an earlier post, it was worth €500k two years ago and now it's down further to €480k.

I gather you own a site jointly? Sell him your interest in the site and let him apply on his own.

Brendan
 
Property prices still haven’t changed, if anything the new estate built on nama land has caused less demand as new properties are available. I haven’t bothered with a recent valuation as it won’t be near neutral yet but am keeping a close eye on other properties.
With regards to the the new property we are still building up savings and looking at options.
It is a joint site which I could sell to him but then I would be putting about 60-70k of my savings into the build along with my site value so unsure how that works for both my risk in event of a split, and for his tax. Can I “gift” that money to him as it is no longer my property? Without my savings there isn’t enough to build so he wouldn’t be able to secure a mortgage for the balance.
My original question was just another option. I don’t mind if my loan to salary wipe each other out (which 300 against me would do ), but obviously the 600 would wipe out the whole joint salary to loan ratio if applied. Hence asking if anyone knows the position.
 
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Can you clarify your situation please?

You jointly own an investment property with your ex husband? Thus is your former family home, it's in negative equity, still in joint names. It's fully registered with RTB, and rent covers mortgage interest only?
You are supplementing with 1400 per month to cover the mortgage?
What's thd divorce settlement in relation to the house?

You jointly own a site with new partner. You are contributing 60k+ towards build costs.

You want to know what mortgage options are, and if your (now) investment mortgage counts towards 3.5 times salary limit?
 
Actually the original question was just wondering if my current property fully counts towards the 3.5 salary as I was trying to keep it simple.

The rest is a complicated mess and I’m wary about posting too much publicly.
My divorce was granted as a no response divorce as he has essentially vanished. Court letters were signed for over a 2 year period so they accepted he was informed however they couldn’t give judgement on house without engagement. Judge advised me I could go back when wanting to sell but in the interests of granting me the divorce without any further delay she left the house alone.
Former personal residence is Registered, rented and in joint names. Full mortgage being paid with the rent largely covering the interest part. No contact with ex to be able to discuss although he is still paying €500 a month into joint account which is odd but as I have no means of contact I just accept. Better than nothing. House in negative equity and costing me about €1000 a month but capital is coming down by more so it’s not a total loss. Interest rate SVR 4.25% and cannot change as requires both parties to agree to a change.

Yes to the info about new site and savings. Desperately want to move on if possible so any advice appreciated.
 
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Dublin Divorce said:
Actually the original question was just wondering if my current property fully counts towards the 3.5 salary as I was trying to keep it simple.
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I understand, but the facts matter here if you want any kind of meaningful advice. I didn't ask anything that wasn't a consideration in looking at options. Feel free to edit anything potentially identifying in you post.

My opinion would be that you currently have a buy to let mortgage on a rental property. As such, it doesn't factor into the LTI calculation at all.

However, as it's cash flow negative, the repayments (stressed) will impact your repayment capacity. Having a non cooperative co-investor / borrower might make it difficult.

I would contact a good mortgage broker to work through this with you, and present it the right way. It needs to be someone that deals outside vanilla applications. As a self build you've a limited number of potential lenders, and you might want to avoid bank that current mortgage is with.
 
That’s really helpful. A big thank you.
With several different facets to my situation it’s great to get advice on here rather than continuing to bounce around different professionals all looking at their own bits.
Thanks again.
 
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