Negative Equity mortgages
Reports in newspapers today suggest that approval has been given for lenders to approve negative equity mortgages.
It is probable that the new loans will be facilitated within the same institution.
This facility will only appeal to a small number of customers, who can sell their home without too much negative equity, and qualify within tough lending criteria for the new facilty.
As always you should seek impartial advice when considering entering arrangements such as negative equity mortgages.
We await details but would expect the likely conditions would be as follows.
1.Clear evidence of affordability demonstrated by a combination of
- No other loans
- Existing regular savings patterns
- At least 10%of purchase price available in savings ( Gifts may be considered
- Strong secure employment with earnings in the region of €75,000 + for a couple or €50,000 for a single applicant
- Total new exposure being less than 4 times gross salary
- Limit on level of negative equity as percentage of new loan -20%
- There may well be opportunities to negotiate on the current exposure where tracker mortgages are in place
We will keep our site updated as news develops.