Single to joint mortgage after marriage and funding an extension next year

[CuriousGeorge11]

Hello,

Any advice would be much appreciated.

My wife took a single mortgage on a property in 2011. We have been married since and had children so the house is no longer big enough. We have saved 55k and are hoping to save another 15k by the time the extension will begin in March 2019

We are remortgaging to extend the house but in order to do this we need to add my name to the mortgage and or deeds. Extension will cost 150k. Current mortgage balance is 180k. New additional mortgage will be 80-90k

The existing mortgage has finished a 1year fixed period and I was inclined to out for a 5 year fixed period.

Our mortgage advisor has told me I'll need to go variable and my options are to leave the existing mortgage and have a second mortgage. Different rates etc. Or pay off the existing mortgage and apply for one bigger mortgage. (one mortgage will be a switcher with boi so may qualify for cashback), 2 mortgages will be equity release.

I feel the mortgage advisor in boi isn't giving me the best advice and mentioned nothing relating to cashback etc in either option until I brought it up. Also is trying to steer me away from fixing even for only a year.

The entire situation is confusing me and any advice would be great. Thank you

 

[Brendan Burgess]

Is your current mortgage with BoI?

What rate are you paying?

You do not need to worry about fixed or variable until March.

You need to get your name on the property deeds. I presume that this is a separate issue and you should probably do that now. Or check with the solicitor to see if is it easier and cheaper to do that when you are remortgaging.

My gut feeling is that you should probably stay with Bank of Ireland until you have everything done. The extension built and the full amount of the mortgage decided.

Then, you should look at switching to get a better deal.

Alternatively, you could just switch to another lender and borrow the €270k - €180k to clear the existing mortgage and €90k to fund the extension.

But you should not be worrying about this now. The market may be completely different in a year's time.

Brendan

 

[CuriousGeorge11]

Hi Brendan,

Thanks for the reply.

Yes our current mortgage is with BOI. Our one year fixed rate of 3.3 expires this week. The variable rate is 4.6% that the mortgage advisor mentioned and advised me to opt for.

In any case I would not be drawing down on the new mortgage until April 2019 so I am 99% sure I will fix for one year at 3% so I'm not breaking any agreements (BOI mentioned I'd be penalised if I opt for 5 year fixed now and then cleared the mortgage)

I haven't dealt with a solicitor because after our initial meeting with BOI they informed me they can add my name to the mortgage in house as we are married.

 

[RedOnion]

Yes, you should fix to avoid the high variable rate. There is nothing to stop you having main mortgage on 1 rate, and then a top-up on a different rate, or fixed for a different term.

BoI don't know if there will be a break fee or not, just that they will calculate if there is one due at that time.