Which way??

scoot1on1

Could someone please help me in deciding on which way to go about purchasing a property. May be a little long winded but please bear with me.
I'll give you a little background first.

I was hoping to buy a property around the £80-100,000 region to BTL however my single wage is only £21000.
I live with my partner and the mortgage on the house is £56,000 it is valued near the £200,000 the mortgage is in her name only.
My partners wage is £20000.
My mother owns three properties and rents those out. Two of which mortagage paid off and total value around about £300,000 (relevance further down)

If I wish to purchase a property would it be better to get added to my partners mortgage then remortgage the house and would this give us enough equity to get a BTL mortgage?

Or if my mother acted as guarantor would I be better going for a single mortgage with her guaranteeing the shortfall one on of her properties.

Or my mother purchasing the property for me, and me dealing with the rent etc. Would this affect her for tax purposes, or could she sign the property over to me or does this also incur a tax?

So many questions If anyone has any other ideas on how I would go about this I would be very grateful.

I forgot to say that I don't enough savings to even bother telling a mortgage company about.

Id like to thankyou in advance for any replies

Jon

dunstonh

I forgot to say that I don't enough savings to even bother telling a mortgage company about.

bit risky this. You are doing a BTL when rental income yield is very small, don't have enough income to get the mortgage in your own right and have insufficient savings.

I will leave the mortgage related questions to the mortgage advisors but I would really recommend you consider the high risk nature of what you are doing.

AndrewSmith

Hi Jon,

When looking at a buy to let mortgage / property it is not necessarily your income that matters so much, as the amount you can borrow is worked out based on the potential rental income from the property. Also you will need at least 15% deposit.

Most lenders will want the expected rental income assessment to be 130% of the new interest-only mortgage calculation. Example:

Assumed rate of 5.5% (there are some better however a lot of lenders will use this assumed rate for calculation purposes).

Property Value £80,000
Deposit (min) £68,000

£68,000 interest only 5.5% mortgage payments = £311.67

Minimum rental figure accepted must be at least 130% of the mortgage payment which = £405.17.

What may be possible is to use some of the equity currently in either your mother's buy to let properties or your partner's house, for the deposit.

Remember though that this is based on the info given and not being privvy to all you financial information (before anyone jumps in and tells me I'm wrong )

Cheers

Andy