Hi Guys,
Just looking for a bit of feedback. Sorry in advance if people find the post confusing. Myself and my wife are both from the country. We are currently living and working in Cork. We're planning on moving home within the next 2 years (before our daughter starts school). We have a very favourable tracker mortgage with AIB on our house in Cork, ECB +.75%. We are currently paying €660 a month. We bought the house at the height of the boom for €370,000. It was financed through the sale of another property and the mortgage. The house is currently worth approx €230,000 with approx €180,000 left on the mortgage.
I own a small house in our home town with no mortgage. It would need a bit of work including a 2 story extention at the back to bring it up to a standard which we'd be happy with. This will be our forever house and will cost approx €90,000 to renovate. My question is how to finance this renovation?
We have €120,000 in savings. My plan was to use €60,000 of this and get a short term mortgage for the other €30,000. Is this a good idea? Would we even get a mortgage of €30,000 for the 2nd house, while we still have a mortgage on the Cork house? Or are we as well off using €90,000 of our own savings to finance the renovation?
We could sell the house in Cork, clear the mortgage and have approx €50,000 after the sale, but then we'd be taking a hit of €140,000 on what we paid for it. Ideally, we'd like to rent out the house in Cork, which would more than cover the mortgage of the house (if we were able to hold on to our tracker). I know we'll never get anywhere near what we paid for the house and we probably eventually will have to sell it, as the ECB wont stay low forever, but I want to maximise any money we can make out of it. I know we're in a better position than alot of other people. We just looking for advice on the best way to go about everything.
Cheers,
Duchalla.
Just looking for a bit of feedback. Sorry in advance if people find the post confusing. Myself and my wife are both from the country. We are currently living and working in Cork. We're planning on moving home within the next 2 years (before our daughter starts school). We have a very favourable tracker mortgage with AIB on our house in Cork, ECB +.75%. We are currently paying €660 a month. We bought the house at the height of the boom for €370,000. It was financed through the sale of another property and the mortgage. The house is currently worth approx €230,000 with approx €180,000 left on the mortgage.
I own a small house in our home town with no mortgage. It would need a bit of work including a 2 story extention at the back to bring it up to a standard which we'd be happy with. This will be our forever house and will cost approx €90,000 to renovate. My question is how to finance this renovation?
We have €120,000 in savings. My plan was to use €60,000 of this and get a short term mortgage for the other €30,000. Is this a good idea? Would we even get a mortgage of €30,000 for the 2nd house, while we still have a mortgage on the Cork house? Or are we as well off using €90,000 of our own savings to finance the renovation?
We could sell the house in Cork, clear the mortgage and have approx €50,000 after the sale, but then we'd be taking a hit of €140,000 on what we paid for it. Ideally, we'd like to rent out the house in Cork, which would more than cover the mortgage of the house (if we were able to hold on to our tracker). I know we'll never get anywhere near what we paid for the house and we probably eventually will have to sell it, as the ECB wont stay low forever, but I want to maximise any money we can make out of it. I know we're in a better position than alot of other people. We just looking for advice on the best way to go about everything.
Cheers,
Duchalla.