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    • NGM16
    • By NGM16 29th Nov 17, 11:23 AM
    • 4Posts
    • 0Thanks
    NGM16
    Help please - remortgaging
    • #1
    • 29th Nov 17, 11:23 AM
    Help please - remortgaging 29th Nov 17 at 11:23 AM
    Hi,

    Was after some help please however it's quite complicated!

    My partner and I own a property with £140000 left on the mortgage. Our fixed rate is soon to end and we'd like to remortgage and borrow an additional 40000 to fund an extension. We think the property is worth roughly 200000. We earn about £62k between us, I only work part time.

    My partner also owns another property that has no mortgage on it and we rent it out. We are trying to work out whether it's best to remortgage our current property to fund the extension or whether we'd be able to remortgage his house to fund it?

    Hopefully someone has some advice, I know we need to see a mortgage advisor really but thought I'd call in here first. Hope I've provided enough information.

    Many thanks
Page 1
    • YHM
    • By YHM 29th Nov 17, 1:05 PM
    • 299 Posts
    • 97 Thanks
    YHM
    • #2
    • 29th Nov 17, 1:05 PM
    • #2
    • 29th Nov 17, 1:05 PM
    You would be taking your residential back upto 90% LTV by doing so, and not that many lenders would be comfortable with taking a remortgage on at that LTV.

    The other option would be to raise a BTL against the unencumbered property, but then some BTL lenders may be funny about releasing equity to extend a separate property.

    Sit down with a broker and get them to work out which option would be best financially, they will do the leg work for you.
    I am a Mortgage Broker.

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice
    • NGM16
    • By NGM16 29th Nov 17, 7:45 PM
    • 4 Posts
    • 0 Thanks
    NGM16
    • #3
    • 29th Nov 17, 7:45 PM
    • #3
    • 29th Nov 17, 7:45 PM
    Thank you YHM, will hunt down a good broker, hopefully we can sort it either way.
    • dimbo61
    • By dimbo61 29th Nov 17, 8:50 PM
    • 9,585 Posts
    • 5,181 Thanks
    dimbo61
    • #4
    • 29th Nov 17, 8:50 PM
    • #4
    • 29th Nov 17, 8:50 PM
    You can get a 75% BTL mortgage as long as the figures stack up !
    Have you used an accountant ?
    What yield do you get from the rental ?
    Some of the many questions you will need to answer before a lender might help
    • NGM16
    • By NGM16 29th Nov 17, 10:30 PM
    • 4 Posts
    • 0 Thanks
    NGM16
    • #5
    • 29th Nov 17, 10:30 PM
    • #5
    • 29th Nov 17, 10:30 PM
    Thanks dimbo61. The house is worth about 150k and we rent it for £675 each month. We pay a small fee to the estate agent for managing the rental and then the rest is obviously ours - I have no idea how to work out yield! So if we were to remortgage that property we'd be wanting 40k on a property worth 150k?
    • dimbo61
    • By dimbo61 30th Nov 17, 8:56 PM
    • 9,585 Posts
    • 5,181 Thanks
    dimbo61
    • #6
    • 30th Nov 17, 8:56 PM
    • #6
    • 30th Nov 17, 8:56 PM
    mortgage broker to find a lender and an accountant to see if the figures stack up.
    You may struggle to borrow only £40,000 on a BTL
    • FTBuyerGlasgow
    • By FTBuyerGlasgow 30th Nov 17, 10:34 PM
    • 17 Posts
    • 13 Thanks
    FTBuyerGlasgow
    • #7
    • 30th Nov 17, 10:34 PM
    • #7
    • 30th Nov 17, 10:34 PM
    Hi NGM16, some good advice above about seeking out the services of a broker and accountant.

    All I'll say is: one word of caution - an extension can cost more than you think. I was recently involved in a small, single storey extension (albeit including other minor internal alteration) measuring about 17m.sq and it cost about £50k.

    Just something to bear in mind with what you hope to get out of financing the extension.

    Hope it goes well for you.
    Started out with nothing, still got most of it left.
    • NGM16
    • By NGM16 1st Dec 17, 9:49 AM
    • 4 Posts
    • 0 Thanks
    NGM16
    • #8
    • 1st Dec 17, 9:49 AM
    • #8
    • 1st Dec 17, 9:49 AM
    Thanks FTbuyerGlasgow. Luckily my Dad is a builder so only really materials we have to pay for - and lots of chocolate biscuits!
    • getmore4less
    • By getmore4less 1st Dec 17, 10:23 AM
    • 30,740 Posts
    • 18,376 Thanks
    getmore4less
    • #9
    • 1st Dec 17, 10:23 AM
    • #9
    • 1st Dec 17, 10:23 AM
    The house is worth about 150k and we rent it for £675 each month
    Gross yield £675*12/£150,000=5.4%
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