Mortgage advice badly needed

Hi all I am hoping someone can give me advice before i meet the bank

Current Mortgage = Standard variable 25 year with First Active...19 years left

I bought this house 6 years ago and lived in it until I got married recently. I now have another mortgage with a different bank for my house with my wife.

I am having trouble renting my old house out and both mortgage repayments are killing me. However I would like to keep the old house if i could

I am hoping to meet with First Active on friday and ask to renegociate the terms of my mortgage. I would like to go first choice interest only for at least one year or otherwise increase my length of repayment to reduce the pressure on me

However I got my mortgage in the wild west days of only needing three payslips and I am worried if they need all these p60s,wage slips etc etc I might get myself in trouble as my current wages wont match my previous wages when i first applied 6 years ago and set off alarm bells with the bank. As i am not looking for a new mortgage just an extension to the current one will it be just the issue of the bank saying no problem or no can do or do i need all this documentation again.

Thanks for reading

Is the area a good area for renting?

Are you the cheapest rent for a similar house in the area? if not, drop the rent. Some rent is better than none and the bank may look on you more favorably if you have rent coming in. They will probably want a higher rate now that you house is an investment property.

If I was you I'd sell, you don't seem to want to be a landlord, you just want somebody else to pay for your house.

Sandymount

No its in the town and its not a high rent i charge, i have had it rented up till recently and the rent almost covers the mortgage. Just the current tenants handed in their notice today and I know next month is going to be tight unless I get someone in pronto which wont happen this time of year. I am just getting by as it is

If the rent was more than the mortgage at least there might be something left in the mortgage account for times like these.

You are probably right, I dont enjoy being a landlord, its an old house prone to problems and I am too soft on the tenants. I just want go give it a go for a 12/18 months schedule as I dont want to look back and regret it by not giving it a try

if you look at trends in the rental sector:

1. the number of rental properties are increasing (see daftwatch for proof)

2. rents are falling (see the property pin for proof, also recent CSO numbers). This fall has accelerated recently and all indicators are that rents will continue to fall in 2009

3. the number of tenants looking to rent is falling (Immigrants returning home and Irish people emigrating)

All this points to a massive squeeze on 'amateur landlords' such as yourself (no disrespect intended) in the next couple of years. Many of them are already funding the difference between rental income and mortgage repayments - and this gap is growing as rents fall.

So with this in mind, I would sell immediately and stick the realised equity in the bank.

catweazle said:

[...] its an old house prone to problems and I am too soft on the tenants.

Click to expand...

... as in actually dealing with the problems or something?

You need to fix problems for your tenants... That's what they're paying you for!!

If you're being soft about rent payments then you need, as Kemo Sabe says, to get out and sell.... If you've owned it for 6 years chances are you can price to sell and still make a nice little sum to put away!!

if you want to extend the term of the mortgage, they will usually just request life cover to cover the new term or a life waiver which the branch can sort out for you.
if you were shortening the term you would require the extra documents.
regarding the interest only it might be just as simple as signing a few forms.

Sell now if you can. Otherwise you will be in serious trouble.Trying to hang on is foolish.