Interest Only for 2-3 Years?

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daveco23

Registered User
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Have just found out that after much planning and talking that my wife is pregnant. After a well deserved lap of honour around the living room I have started to go through the financial aspects of such a commitment and am trying to put all our financials into prespective.
Apart from a mortgage of 358000 (1678 per month) we are debt free, I earn circa 70 k and my wife 35k.
I want my wife to have the option to return to work after maternity leave - ie I don`t want her to feel she has to in order to fund mortgage and living expenses. For this reason we are thinking of going interest only on the mortgage for 2-3 years to accomodate this and also raising baby especially in the first few years is not cheap.. Has anyone done this? Pro's and Con's would be appreciated.
 
First and foremost - congratulations!!

Both IIB and Bank of Scotland offer interest only homeloans as a matter of course - the former for up to 36 months, the latter for the whole term if required. PTSB will also consider interest only homeloans if the household income exceeds €100,000 which yours does. Other lenders will do them on a case by case basis. The pros are obviously the reduced monthly payments, the cons are that your payments will subsequently higher to repay the capital over the original term. On a mortgage of €358,000 at (say) 3.35% your interest payments (before tax relief and insurance) would be €999 per month.

Sarah

www.rea.ie
 
Did you max out your SSIAs? If so, you'll soon have ~€500 per month more disposable income. That plus children's allowance should more than cover the cost of a little person.
 
pnagle said:
Did you max out your SSIAs? If so, you'll soon have ~€500 per month more disposable income. That plus children's allowance should more than cover the cost of a little person.
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Only moved back to ireland last year after 8 years away so no SSIA. Childrens allowance here would not keep you in pampers for a month... Thanks for the advice though.
Sarah - thanks for the info - great help. Still not sure if I will do it yet, but food for thought.
 
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