Remortgage or mortgage advice needed

fumken

I have a house worth about £320000 with a mortgage of 40000. I need to buy a new house due to relocation. I put the house on the market but hardly any viewers so I intend to hold on to it and rent out for about £1100pm.
My salary is £47,200pa and I want to buy a house worth about £190000, so total mortgage(s) will be about £230000.
I have no deposit so I guess I need to either remortgage the old house on buy to let and take some equity for a deposit on a new 2nd morgage or just remortgage the old house as it is. Is it possible to remortgage a house on the market for sale? Is there a disadvantage to a buy to let mortgage?
Where is the best place to go? I currently have mine with Woolwich and only remortgaged about 6 months ago to an offset to the 40k.
In the current climate should I just stick with Woolwich?
Thanking you all in advance!
I

happybroker

there are some really good buy to let rates at low loan to value so depending on wether or not you are tied to the woolwich that could be your best option for the old property.

if you borrow enough to put a decent deposit down on the new one (25% or more) then you will also have the pick of the rates at that end too.

As it's not all that straight forward it would be a fair suggestion that you speak to a decent whole of market broker who will be able to co-ordinate the whole thing for you and also get access to buy to let deals that you wouldn't get by going direct to the lenders you will know about (its a pretty specialist area and lenders do tend to try and attract brokers in that arena)

Good luck

Moggett

The main disadvantage going buy to let would be the very high arrangement fees charged by the lenders on the most attractive rates - could be as much as 2 to 2.5% of the loan. However if you remortgage for the full £230k you will be looking at almost 5 times salary and depending on whether you have any other credit comittments this could rule out a lot of lenders. Ones that will often lend that much include C&G, Nationwide, halifax and maybe Abbey. You would probably get a better rate, with lower fees remortgaging for the full £230k but as happybroker suggests, it would be worthwhile seeing a decent broker who will be able to assess your affordability and have access to the whole market.

fumken

Wow! Thanks for this. I really have to do the sums. It may work out cheaper to get as much as possible from the remortgage and then take a normal mortgage.
Will let you know how it goes.