help on which way to loan money short term

june66

i want to buy a second property to do up, i have a morgage at the mo, and want to buy for about £40,000, hopefully it will be a quick turn around about 3-4 months, i only work 12 days a month so i will have time and an income still coming in, i dont no if to get another morgage on a fixed rate or an interest only or get a short term loan, can anyone advice me which would be best to do.. thanks to any one who can help....

distilled

You want to borrow money?

june66

yes i want to borrow money to buy a property but will be selling within 3-4 months,want to knowbest way to do it.

regularsaver1

is there equity in your property as the moment that you can raise?

will your income afford the additional funds (sorry you say you work 12 days per month but no other details)

is £40k a reasonable budget for buying, fees, and property developing (i've seen them programmes)

june66

yes there is equity in my property but not enough, yes my income will be able to afford the additional funds, working 12 days at 12 hrs a day, shift worker, ive seen a house for £37k. and have additional savings to pay for house to be done up, so just really wanted to know best way for a quick turnaround of raising money, thanks for your reply.

Doozergirl

The best would be to mortgage the property, concentrating on low set up and redemption fees rather than the interest rate you're getting.

Have you done the maths as to how much it's going to cost to buy, fix up and sell on? How much needs doing to the property? Problem with low-value property is that your budget is super-sensitive.

Tassotti

Hi june66

Is this your first project? Property Development can be profitable if you are an expert. However, if you are inexperienced, then can be a risky way to go, especially in a stagnant market.

My suggestion is to do a lot more research into ALL the costs involved,ie purchase price solicitors fees, survey fees, (re)mortgage application fees, mortgage repayment fees, refurb costs, selling costs, est agent fees, tax....

How much do you think the property will sell for when renovated? Estimate the time taken to redevelop and the cost, then double both tese figures and add a 10% contigency fund.

My feeling is that this project will be a lot of stress for very little return (if any). Don't forget that any profit you make will be subject to tax.

How many times has Sarah Beeney said on Property Ladder "Well done the house price has increased by 30K. However, this is due to the rising market and not the 9 months of work you've put in. If you had done nothing at all, same result.

Do a lot more research and be careful

june66

thankyou for your help, the houses around that area are selling for about £75k, and my husband will be doing most of the work he is really interested and its kind of his hobbie, he works as well 12 days a month so will have lots of time and has been doing jobs on houses for people alot lately, and thought we would have a go outselfs, i think the best way to go is a low set up and no redemption fees, i suppose we will learn from this project, and if we dont try we will never no...thanks all.

regularsaver1

i wish i could buy a house for £37k - one bed flat here £110k grrr

robwend

i wish i only worked 12 days a month!!!