let to buy mortgage?

meclive

Hi guys I'm looking for a bit of help. Does anyone have any dealings with let-to-buy mortgages? I have a house that is worth £155,000 with an outstanding mortgage of £50,000. Would I be able to borrow against this to get another house? I have no deposit for the second house, but I've come across let-to-buy mortgages. Am I correct in thinking these mortgages allow you to borrow against the equity in your current home to buy another and let the first home out? How exactly does it all work? I've tried on google but there was way too much information for a clueless person like me. Does anyone have an idiots guide? thanks.

rent_and_buy

Buy to let mortgages are higher rates and higher fees, as you havent found a house remortgage your house on a interest only residential mortgage, but before you do it ask about any charges if you decide to let your house out.

Then remortgage interest only on a 105,000 residential mortgage, clear you previous mortgage, and you will have 55,000 pound to go towards your deposit for the next property.

Tell them you want the extra money for house improvements, they wont question it as you have a lot of equity, and if a house does come up when you are doing the extras, you will have the 55000 pound waiting for a deposit for your next property.

remember when you let your house out, the mortgage company will be happy has long as the rent clears the mortgage repyments and another 25%, i am thinking of doing it myself and it could save me over 100 pound a month by doing it.

people say its fraud but its not, i think its just a lot of current landlords whou are jealous that they can not get these low rates.

luckyfool

People say it's fraud when you tell your lender you are wanting extra money when remortgaging to do home improvements, when it's actually to buy another property? I can't imagine where people would get that idea from!

I would direct you towards the Oxford English Dictionary definition of "Fraud".

If you wanted to do it on a Residential mortgage there is nothing to stop you requesting the additional funds and saying they are to buy another property. Most lenders do not have a problem with that, no need to start lying/committing fraud.

rent_and_buy

Heres the definition of fraud.

Fraud for profit involves industry professionals. There are generally multiple loan transactions with several financial institutions involved. These frauds include numerous gross misrepresentations including: income is overstated, assets are overstated, collateral is overstated, the length of employment is overstated or fictitious employment is reported, and employment is backstopped by conspirators. The borrower's debts are not fully disclosed, nor is the borrower's credit history, which is often altered. Often, the borrower assumes the identity of another person (straw buyer). The borrower states he intends to use the property for occupancy when he/she intends to use the property for rental income, or is purchasing the property for another party (nominee). Appraisals almost always list the property as owner-occupied. Down payments do not exist or are borrowed and disguised with a fraudulent gift letter. The property value is inflated (faulty appraisal) to increase the sales value to make up for no down payment and to generate cash proceeds in fraud for profit.

Now this would be the case if he got the mortgage and then let the property out, but has it happens he will be living in the property.

Im sure when he gets the re mortgage he will be living in the house, if in a months time he decides to rent it out and is bank will agree and its like mine will then happy days.

@fool before you start telling people to look up the meaning fraud, i think you should have took a look yourself.

who feels a fool now>???;)

socrates

Always good to see someone using two different names on here.

I hope it does not make anyone else get 'confused'

luckyfool

Seems straightforward to me.

If a lender asks you a question (i.e. what is the extra money for?), and you tell them the answer that you think will get them to lend you the money rather than the truth, then that is deception (i.e. lying) for financial gain (i.e. to get the mortgage lender to give you money).

I'm not sure why you are coming onto internet forums and encouraging people to lie on mortgage application forms?

FraudBuster

The Fraud Act 2006

2) The sections are—
(a) section 2 (fraud by false representation),
(b) section 3 (fraud by failing to disclose information), and
(c) section 4 (fraud by abuse of position).

http://www.legislation.gov.uk/acts/acts2006/ukpga_20060035_en_1

rent_and_buy

luckyfool wrote: »

Seems straightforward to me.

If a lender asks you a question (i.e. what is the extra money for?), and you tell them the answer that you think will get them to lend you the money rather than the truth, then that is deception (i.e. lying) for financial gain (i.e. to get the mortgage lender to give you money).

I'm not sure why you are coming onto internet forums and encouraging people to lie on mortgage application forms?

Yes but that is not fraud, he still has to pay the money back, and to be honest if he says its for home improvements or if its to buy another house to let.

When he takes out his mortgage it will be his sole residential property, so why shouldnt he have a residential mortgage?

I told my bank i may let it out in the future they said if you decide to i would have to pay a 199 pound fee.

If i decide to rent a little sooner than what i thought im sure they will let me, the banks are only bothered about getting the money back and if the man can afford to pay them back then fair play to him.

you need to get of your high horse and start reading the dictionary

rent_and_buy

socrates wrote: »

Always good to see someone using two different names on here.

I hope it does not make anyone else get 'confused'

and you should know, he arranges a mortgage with his bank whilst he his a residential home owner, whilst he takes the mortgage he asks them. whether it would be okay if he rented in the future and what would the rate be, they either say no you can not, or yes you can.

he hasnt lied whether he rents in 1 month or 2 months it doesnt matter, jealousy is a bad thing you lot need to get over it.

socrates

rent_and_buy wrote: »

and you should know

I only ever use one name and I challenge anyone to prove otherwise.

Shame the same cannot be said for you - what happened with the Nationwide?

They would not play ball so now its the Post Office?

rent_and_buy

socrates wrote: »

I only ever use one name and I challenge anyone to prove otherwise.

Shame the same cannot be said for you - what happened with the Nationwide?

They would not play ball so now its the Post Office?

I dont know what your on about?? are you some kind of wierdo?? sockmuppet.