Need to borrow more ?

A

appollo10

Guest
Hello all,
Just wondering if someone could give me some advise. I have a house for the past 6 years. What is left on my morgage is about €80,000, i have a car loan of €7000 for the next 2 years and a personal loan for home improvments of €9000 over the next 4 years. Trouble is that i would like to landscape all around my house which would take about €15,000 to do it. Which way would be the best way to go about getting the money. All my loans are with the A.I.B. Is a top up on my morgage the way to go.... what would that incur ?
Thank
Appollo
 
What is your house worth today approximately? The cheapest way to borrow, if feasible, would be to top up your mortgage and then pay the top up off over an equivalent period of time as a comparable personal loan (e.g. a few years rather than a few decades). You might also consider consolidating the car loan onto the mortgage in a similar way. Note the point about scheduling the top ups over a few years rather than the whole remaining mortgage term. Bear in mind that consolidating onto the mortgage may be a good idea (e.g. as a way to release equity from your home) as long as you don't go mad and keep piling debts onto the mortgage loan. Also - just because you are with AIB shouldn't preclude you from shopping around and seeing if remortgaging with another lender might yield savings. If you are talking to lenders directly then don't assume that the "advice" they give you is independent or in your own interest.
 
Clubman,
My house is valued at € 290,000 at the moment. Could you give me a few names to go with ?.
Thank you for your time.
Appollo
 
My house is valued at € 290,000 at the moment.

That means that you have c. €200K in equity locked up in your house so, within the constraints mentioned above about not blowing the budget and racking up onerous debt, a mortgage top-up might well be a suitable way to cater for your borrowing needs.

Could you give me a few names to go with ?.

See the best buys list and have a browse through the .
 
Thank you very much for your help. This is truly a remarkable website ...
Appollo.
P.S i will be back !
 
Trouble is that i would like to landscape all around my house which would take about €15,000 to do it. Which way would be the best way to go about getting the money.
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Here's my (probably unpopular suggestion) - pay off your personal loans & car loan first - then save up the €15k then get your landscaping done.
 
It's a fair point but when there is c. Eur 200K of equity locked up in the property and no obviously onerous debt burden perhaps it's reasonable to splash out a bit as long as the borrowings are managed carefully (e.g. at mortgage rates and over the shortest term possible and not over the full mortgage term). Maybe I'm losing my skinflint touch and getting a bit soft though... :)
 
With my personal loan and car loan, can i pay them off in lump sums if i had the spare cash or do i have to follow the routine of monthly payments ?
 
With my personal loan and car loan, can i pay them off in lump sums
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It depends on the loan. Variable rate loans can generally be paid off with lump sums at any time (e.g. credit union loans). Fixed rate loans generally have penalties for early payments. Check with the loan provider for specifics on your loans.
 
Variable rate owner occupier home loans can definitely be paid off on an accelerated basis without penalty. I presume that this also applies to mortgage top-ups for other purposes scheduled over a shorter term that the main part of the home loan but you should check if you are considering this strategy.
 
Just wondering is top up loan /consoladating one of the main reasons for Mortgage Defaulters ,
Look at the advice about using a Variable rate rather than fixed or tracker,
Post 5 is Interesting also,
On reflecting advising people to consolidate loans into there Mortgage is not good advice,
Lots of it going on before the bust worth reading back to see what was going on back then
 
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RETIRED2017 said:
On reflecting advising people to consolidate loans into there Mortgage is not good advice,
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Hi Retired

The best advice came from Rainyday - to pay down borrowings and save up to pay for landscaping.

However, for someone who already had expensive personal loans, refinancing them with a cheaper loan was good advice.

It was often discussed at the time and usually it was pointed out that although you were topping up your mortgage, you should repay the top up over the short term.

Brendan
 
Brendan Burgess said:
Hi Retired

The best advice came from Rainyday - to pay down borrowings and save up to pay for landscaping.

However, for someone who already had expensive personal loans, refinancing them with a cheaper loan was good advice.

It was often discussed at the time and usually it was pointed out that although you were topping up your mortgage, you should repay the top up over the short term.

Brendan
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Which in most case they finished up paying the highest rate on there mortgage not to mention all the other issues including using there home equity to live from day to day,
We tend to forget the banks finished up lending money to people through the equity the thought people had forgetting to check if it could it be paid back on normal rates
,
Any how it is possibly one of the main reasons people are paying high Mortgage rates today,
 
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