borrowing more on current mortgage to buy another house

hello there,
not sure if you can do this or not so just need some advice....

currently have a mortgage of £15K and our property is valued at £135K by our current mortgage provider of Nationwide.
I have been told that we can borrow up to 85% of the value of our house (this needs to include our current outstanding mortgage).
We are looking into the idea of buying a house for our mother-in-law that is closer to where we live and the one we are interested in is on the market for £95K.

Can we borrow the money on our existing mortgage to buy this additional house leaving us with a total outstanding combined mortgage of £110K? We are currently on the old nationwide BMR now sitting at 2.5% and if we had to take out a new mortgage for the property we would have to settle for a higher rate and also find a 15% deposit so obviously borrowing on the existing mortgage would be the best if we could do it.

Any help would be gratefully received! :o

Replies

  • Is £135k the current value of your property? If not, then NW may want to revalue it. Subject to this it should be ok (you will be reassesed to decide if you have sufficient income etc to take out the additional loan).

    I successfully did this with Woolwich last year - they charged £150 and called it a home improvements loan.

    If this fails then maybe you could borrow a smaller amount to cover say a 40% deposit and take a 60% mortgage on the new house?
    MFiT - T2 # 64start date: 1.7.09 MFW end date: 31.10.17
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  • snowmensnowmen Forumite
    547 Posts
    Part of the Furniture 100 Posts Combo Breaker
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    yes THRIFTY GIRL £135,000 is the current value of our house according to Nationwide which is spot-on.:cool:
    I just didnt know if you could borrow more on an existing mortgage to buy another house - in effect have one mortgage to cover both houses rather than having to have 2 separate mortgages for the 2 properties.
    Thanks for the help.
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