bride loan, rent out what we have or what?

gehngus_2

My wife and I are having another child, we need a bigger house and have found something that is more than wonderful.
Its a house that was previously on the market at £310K, but the bank have instructed a local estate agent (coincidentally a friend of mine) to put it up for offers in the region of £185k I have been able to go and get a preview and Wow! I could only dream of such a place.

I do not want this to one get away which means buying it outright and waiting for ours to sell (im sure a chain would be unacceptable on a repo like this?).

We do have a property to sell that was valued at £195k three years ago and we are more than happy to slash this price dramatically and add to our current mortgage if necessary.
We only owe 50k and the repayments are small in comparison to my income.
The house we live in is a barn conversion with over a hectare of land in a sought after area (sea view, mountain views etc.) and there are very few properties for sale in this village, those that are for sale are all in the £300k+ bracket.

I could afford interest only payments on both but I have been told that i might be better off renting our current home out.

I wondered if there were any other options other than "Don't buy it" which isn't an option at all. We want it. and even though the houses seem to be similar values we would drop our price drastically and add it to the mortgage if necessary.
as we could increase our mortgage to get this one.


or is there another way? mortgage holidays? re-mortgage an amount to cover for any eventualities? mortgage protection...any advice would be good.

current prop value (175 ish probably much more but id take this amount or less even) ill find out it real value soon.
Property i want £185k
current loan 50k not on any deals of discounts (just on what ever the basic repayment rates are). repaying £412 pm
My sole income £42k pa
wife income 9k pa
rental income that we could get for the cottage 7k - 9k pa

Many thanks for your time.

gehngus_2

I forgot to add that I intend to put an offer in for £170k tomorrow and tell them im in a position to proceed. and then work out how to do it...

GDB2222

With prices dropping at 2% a month, this is not a good time to be doubly exposed to the property market. Consequently, I would get rid of the cottage ASAP. Slashing the price is the way to do it. You should get some valuations done on a forced-sale basis, so you know where your bottom line is. Get a valuation from your friendly agent, for obvious reasons.

Bridging loans are really, really frightening imho, unless you have a definite exit lined up. I had a bridging loan for a few weeks, but it was just to get building work done on a new house. I already had exchanged contracts to sell my old one.