Bank Of Ireland 1st Start Mortgage

36square

"We are very comfortably off after paying off our own mortgage early and having several other rental properties..We beleive in giving the children money now ( when they actually need it and can benefit from it as opposed to when we are pushing up the daisies...."

Then why don't you increase the mortgage(s) on you rented properties and give your child the proceeds to buy a property. The additional interest can be set off against the rental income for tax purposes. Your child then pays you the interest net of tax. The 4.5% BoI mortgage is not particularly cheap and if you can borrow at up to 5.6%, it makes no sense at all.
Or why not just give your child one of your rental properties. They wouldn't have to bother abouta mortgage at all and it could save a lot if IHT as long as you live for another 7 years.

niceday999

36square wrote: »

"We are very comfortably off after paying off our own mortgage early and having several other rental properties..We beleive in giving the children money now ( when they actually need it and can benefit from it as opposed to when we are pushing up the daisies...."

Then why don't you increase the mortgage(s) on you rented properties and give your child the proceeds to buy a property. The additional interest can be set off against the rental income for tax purposes. Your child then pays you the interest net of tax. The 4.5% BoI mortgage is not particularly cheap and if you can borrow at up to 5.6%, it makes no sense at all.
Or why not just give your child one of your rental properties. They wouldn't have to bother abouta mortgage at all and it could save a lot if IHT as long as you live for another 7 years.

The rental properties are owned outright having used the rent over the years to pay off the Mortgages on them. We are late 40's so dont really want to be taking a big loan. The last rental property was bought in 1999. We always said we would give the children a house each to start them off but now we like having the rental income which pays for holidays and upgrading our car etc......So I do feel a bit guilty in not helpin her out....But we have worked hard to get our own mortgage paid off early...

We have given her money towards her deposit which she has in her ISA, and we'll also help when she moves in with furniture etc.
Do you think its not such a great deal then at Bank of Ireland.Is it a fixed rate in that she can change after a few years to a better deal. It seems the only bank/building society that offers a Mortgage with parents income taken into consideration.

36square

Why on earth did you want to pay off mortgages on your rental property? The only reason would be absolute confidence that you're never ever going to need to borrow again. Now you feel you need to help your child borrow but won't contemplate doing it in probably the most efficient way because in your late-40s you're worried about having a loan which your child would be servicing even if it's in your name. I'm sorry but you sound more like you're in your late 70s.

tara747

niceday999 wrote: »

The rental properties are owned outright having used the rent over the years to pay off the Mortgages on them. We are late 40's so dont really want to be taking a big loan. The last rental property was bought in 1999. We always said we would give the children a house each to start them off but now we like having the rental income which pays for holidays and upgrading our car etc......So I do feel a bit guilty in not helpin her out....But we have worked hard to get our own mortgage paid off early...

We have given her money towards her deposit which she has in her ISA, and we'll also help when she moves in with furniture etc.
Do you think its not such a great deal then at Bank of Ireland.Is it a fixed rate in that she can change after a few years to a better deal. It seems the only bank/building society that offers a Mortgage with parents income taken into consideration.

No, it's not a good product, and I am absolutely gobsmacked that BOI is offering it. It sounds like a relic of the mad years up to 2007. The only income that should be taken into consideration is that of the person, or couple, buying the house. :eek:

Here's my tuppence worth. House prices are falling and will continue to do so imho. Why not let your daughter keep on saving for now, and when she comes to buy she will get a better house for her money, OR pay less for it. We have a hefty deposit but we are sitting it out for now. When IRs rise and the public sector cuts start later this year, house prices will fall even more.

Can she actually afford the mortgage she wants (factoring in practically guaranteed IR rises), plus rates, insurance, bills, upkeep etc? To find out, she should be able to save at least the equivalent of this (net of any rent she currently pays) each month. If so, good. If not, she's going to struggle.

I'm not being nosey btw, I am asking these questions to help you understand whether this is a realistic idea or whether your daughter should wait and see what happens to house prices.