Mortgage & personal loan

Hello there,

I just put a booking deposit for a second hand home just yesterday and I am fine with paying solicitors other other relevant expenses in relation to the property purchase. I was told by my solicitor the paper work process will start in the beginning of new year and he told me that everything takes about 1.5 to 2 months say end Feb or beginning of march. I am forecasting some expenses in the month March and I may have to borrow some money from the bank say around 20 K. Can I ?

a. ask my mortgage lending institution to provide me some money extra on top of actual mortgage?

or.

b. get a personal loan else where?

I think my solicitor indicated the closing time of the property deal will be sometimes during Feb end or beginning of march.

Is it advisable to wait till I get my mortgage cheque?
or
can I apply for a loan now(ie. after I receive mortgage papers)?

Please advise.

Pint6

Depends on how you are fixed financially, but I would add the 20 k to the mortgage application - less interest to pay.

daveco23 said:

Depends on how you are fixed financially, but I would add the 20 k to the mortgage application - less interest to pay.

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If this is not possible in that you are mortgaged to the limit, do not take out a personal loan until after you have the mortgage drawdown, as most banks can and will do a further credit check before they issue the cheque, which will then show them additional borrowings, they may not give you the mortgage if you are streached to the limit, be careful

Hello There,

Thanks, so you mean to say hold on till I move to the new home and get a loan?

Regards,

Pint6

If you cant get the loan added to the mortgage, then hold off till the mortgage has closed, or you could risk not getting the mortgage at all,

Are you getting 100% mortgage,? if so there is no scope to add to this, if you want to give me some figures, I can work out if its possible to add to the mortgage, however bear in mind that if you add this to the mortgage you are paying a short term loan over a long term

Hello there,

Thanks for your reply again. 'am a FTB and getting 100% mortgage. Actual property costs 330K, after paying stampduty and other costs I will not be left with any money by march.

So I thought of borrowing some money from mortgage lender or other financial institution, so that I could pay off some small loans and keep one payment go forward.

Regards,

Pint6

daveco23 said:

Depends on how you are fixed financially, but I would add the 20 k to the mortgage application - less interest to pay.

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Are you sure about this?

€20k for a few years at circa 8% works out at a lot less than €20k over 20-40 years, even at a rate of circa 3.25%. (20k at 8% over 5 years gives interest of over 4k, 20k over 25 years at 3.25% gives interest of over 9k)

Or am I missing something?

Exactly right, adding to the mortgage is mad, no savings to be had in the long run

However Pint6, you will not have the option to add this amount to the mortgage as you are getting 100% of the property value. But please wait until you have your mortgage cheque in hand before getting any more loans, as you could find yourself not able to get the mortgage as the bank could feel that you financially over doing it. An ICB report will show the lender all loans at that time, and if they pick your mortgage to do another ICB at cheque issue time, your mortgage lender may not proceed with the loan. I have seen it happen

The best of luck with the new property, and any other questions please feel free to ask.

Regards

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