How do i take equity out of my propety w/o getting a BTL mortgage?

emilyb112 · 13 January 2009 at 10:33PM

OK so im desperate for a bigger place but i can see alot of potential in my little London flat re rental income vs mortgage, location is great for tenants and before July 2007 we had made great money in value in just two years. So i dont really want to sell it.
But I need space. I have considered renting it out and renting a new place but ideally i would like to take advantage of being able to buy somewhere that may have been out of my price bracket 1 year ago before prices start to climb again.
My flat currently has £59k equity in it.
So if i were to leave a say £20k in my flat and rent it out i would be left with around £30- 39k (depending on the mortgage companies valuation) to put down on a new house.

Will it be a struggle taking this money out of the property?

Will they decide wether or not to give me the money based on my intentions with it.....i mean what if i wanted to buy a car - it has no bearings on my mortgage payments.

I really don't want to get a BTL as my interest rates are 2.49% at the moment, where as BTL seem to be about 6%? Plus its possible i will not be renting it out for another six months - i just want to get this money out before my property goes down in value even more.

Will i have to get a complete new mortgage or can i take out a seperate mortgage for the new borrowing of £30k?

Its seems quite simple to me...if i were to buy this property i would only have to put down 10/15% but im anticiaping a struggle trying to take it out!?!

By the way it is currently on the market but so far ive had only offers alot below the asking price..making me dig my heals in further reluctant to lose money if im not desperate to sell.

emilyb112 · 13 January 2009 at 10:36PM

P.S i cannot get the silly edit button to work....the 2.49% interest rate is the rate of my current mortgage incase that wasn't clear.

feisty1 · 13 January 2009 at 10:48PM

Quote: Will they decide wether or not to give me the money based on my intentions with it.....i mean what if i wanted to buy a car - it has no bearings on my mortgage payments.

You mean obtaining money by deception?

emilyb112 · 13 January 2009 at 10:57PM

Ha why would it be by deception? Are you not allowed to borrow more to buy a car?

feisty1 · 13 January 2009 at 11:02PM

Of course you are, that's if you buy a car. However, if you're borrowing money to purchase another property, you don't say yr buying a car.

emilyb112 · 13 January 2009 at 11:22PM

I think you're missing the point my example was trying to make.

feisty1 · 13 January 2009 at 11:29PM

I'm not missing any point, if you wan't to release equity, you say I want to release equity not buy a car

brit1234 · 14 January 2009 at 2:01AM

You are going to need to put equity into your buy to let when you remortgage or you are increasingly unlikely to get a mortgage and might lose the property.

So by taking equity out of your property you are shooting yourself in the foot. Why do you think buy to lets are being repossessed at a far higher and growing rate against residential properties.

If you want to lose even more money I recommend buying Taylor Wimpy Shares.:eek:

maninthestreet · 14 January 2009 at 8:10AM

Do what the majority of the rest of us would do if we needed a bigger property - sell your current property, and use the equity to buy a new, bigger property.

littlened · 14 January 2009 at 8:28AM

I'm no expert, but you might find to let a property out, you need around 25% equity in the property. If you only leave £20k in the flat, that's under 15%.

How do i take equity out of my propety w/o getting a BTL mortgage?

Comments

Confirm your email address to Create Threads and Reply

🚀 Getting Started

Categories

Is this how you want to be seen?

Get our FREE Weekly email full of deals & guides - and it’s spam-free