Getting rid of two apartments for a house

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beachman

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Brendan, any thoughts on our situation? Apologies if not posted in right forum, a bit new to this

Our situation: Married, we live with baby in my 2-bed apartment bought for €335,000 in 2005 (with a 100pc mortgage).
Mortgage now €300,000, tracker repayment about €1,000 a month. Property currently worth approx €230,000 on open market, near DART, nice location. Think prices here will rise a bit in time.
As of end of July, aside from mortgage, I have no debts, credit card zero balance, hoping to have €20,000 saved by middle of next year.

Her: bought apartment in 2005 for €299,000 before we met. Mortgage now about €240,000. Prop worth sub €150,000 on open market. Tracker mortgage repayment about €955 a month, currently rented out at €900 a month so just about washing its face. Would dearly love to offload it. She has no debts, hoping to also save about €15,000 by middle of next year.

So, we will then have €40,000 savings for starters. Obviously, what we want to do is move into a house at some point. What are our options with the two apartments? How will banks rate our circumstances/? Are we better off renting? What should we do?
 
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Your post's title says getting rid of two apts in exchange for a house.

At present some banks are starting to allow people in negative equity to sell that property and buy another one. I gather this is still not easy -there are some posts on this.

I have heard that many couples have approached banks for this type of thing but if the two properties are with two seperate banks then forget it.

If the two apts are with the same bank then it may be possible although your negative equity is fairly large - about 160k.

However, with a reasonable deposit of 40k AND proof of a good income then ,yes, it's still a slow and messy process but you would have a small to fair chance of mortgage approval BUT the loan would be a variable interest and you'll soon notice the difference in monthly repayments.

Without knowing your incomes or what price bracket you're looking at it's dificult to be more than vague. But very crudely let's say the bank allows you 3.5 x your combined income of 100k =350k but you must deduct 160k . You couldn't buy much for 190ki plus 40k deposit (230k).

Frankly, as you both have trackers and if the rent covers the repayments then I'd keep hold of the apts and rent a house. Much easier. Much cleaner. And more profitable.

Sorry for rather vague and messy way i wrote above.
 
Thanks for that helpful advice OldNick, much appreciated.

Yes, it's as we thought, it's potentially complicated. The mortgages are both with same bank - I earn €90k a year, she €65k. But I could possibly make mortgage application on my own steam? and leave her affairs out of it. Alternatively, as you suggest, we've no problem renting a house.
 
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