Hi Brendan,
Can I ask you for more advice here. We applied for a negative equity mortgage with AIB on the assumption that the central bank deposit rules did not apply to people in our situation.
We have totted up all our savings and it turns out we actually have 60,000 in savings between our various accounts. We will be carrying forward approx 70,000 of negative equity. We sought an overall mortgage (including the negative equity) of 415,000.
After indicating that the numbers might add up, we did as AIB asked and had a property vaulation carried out.
AIB's mortgage unit then processed the application and rejected it. The mortgage advisor said the very most we could hope to draw down on a new property (before negative equity) would be well below 300,000 euro.
AIB say if we want mortgage approval up to 415 grand (which includes the negative equity), we need to have well upwards of an 80,000 euro deposit. They also estimate that various fees and stamp duty would amount to around 15,000 euro and they are factoring this into the calculation.
If they had accepted our 60,000 euro deposit and we had purchased a property worth 400,000 - the loan to value of 175% that exists on our current property would become 97% on the new property.
AIB's mortgage advisor also tells us that the Central Bank deposit rules DO apply to us and we would require a 20% deposit on the new home. We met the loan-to-income requirements.
They also claim we would incur a breakage fee on a 2 year fixed rate that is due to elapse later this year.
I doubt this is going anywhere and we are likely to be forced out into the rental market - becoming reluctant landlords who have to top up their mortgage and then pay tax on that. Saving a despoit in this scenario becomes impossible.
Is this right what they are saying to us?
Can I ask you for more advice here. We applied for a negative equity mortgage with AIB on the assumption that the central bank deposit rules did not apply to people in our situation.
We have totted up all our savings and it turns out we actually have 60,000 in savings between our various accounts. We will be carrying forward approx 70,000 of negative equity. We sought an overall mortgage (including the negative equity) of 415,000.
After indicating that the numbers might add up, we did as AIB asked and had a property vaulation carried out.
AIB's mortgage unit then processed the application and rejected it. The mortgage advisor said the very most we could hope to draw down on a new property (before negative equity) would be well below 300,000 euro.
AIB say if we want mortgage approval up to 415 grand (which includes the negative equity), we need to have well upwards of an 80,000 euro deposit. They also estimate that various fees and stamp duty would amount to around 15,000 euro and they are factoring this into the calculation.
If they had accepted our 60,000 euro deposit and we had purchased a property worth 400,000 - the loan to value of 175% that exists on our current property would become 97% on the new property.
AIB's mortgage advisor also tells us that the Central Bank deposit rules DO apply to us and we would require a 20% deposit on the new home. We met the loan-to-income requirements.
They also claim we would incur a breakage fee on a 2 year fixed rate that is due to elapse later this year.
I doubt this is going anywhere and we are likely to be forced out into the rental market - becoming reluctant landlords who have to top up their mortgage and then pay tax on that. Saving a despoit in this scenario becomes impossible.
Is this right what they are saying to us?
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