Avoiding personal debt
Short term debt can have major implications on cash flow.
A 250,000 mortgage over 35 years will cost approximately €1340 per month at a mortgage rate of 5.5%
A €10,000 loan over three years at 8.5% will cost €315 per month.
The short term loan repayments account for almost 25% of the mortgage payments in the above scenario.
It is important therefore to plan carefully for any debt repayments and to avoid borrowing if at all possible .
The above example also illustrates the importance of saving both before and after your house purchase