Remortgage for holiday let.

Nicotom

We have no mortgage on our house and want to convert our barn to a holiday let. Our joint incomes are not sufficient to raise the amount needed via a normal mortgage, and Buy to Let seems to look at the current value of the property to be let, not the other assets of the applicant. Does anyone know a solution to this please?

herbiesjp

You can raise a normal residential on your current unencumbered residential property.

You can then use those funds to convert the barn

As long as your income can support the mortgage, and you fit all other criteria, you should be fine

What is the property value? And how much do you want to borrow?

theartfullodger

NicoTom: What were you advised when you called a number of mortgage brokers>>>>???

Nicotom

herbiesjp wrote: »

You can raise a normal residential on your current unencumbered residential property.

You can then use those funds to convert the barn

As long as your income can support the mortgage, and you fit all other criteria, you should be fine

What is the property value? And how much do you want to borrow?

Our current income from work is not sufficient under normal lending rules ( 4.5 times joint income ) to raise the amount required, but when the income from rent is taken into account we would have sufficient. Current value is about 600 k. Need to borrow about 200k.

Nicotom

Other brokers? We had a self-cert approved, but it expired before we could get planning permission. Now we are told get a buy-to-let on our house, even though we aren't intending to let it.

herbiesjp

Nicotom wrote: »

. Now we are told get a buy-to-let on our house, even though we aren't intending to let it.

That would be fraud!!!:eek:

I would steer well clear of who told you that

You may be able to get 4.5 times your incomes - but it will depend on the overall scenario

I would get in contact with a reputable whole of market adviser who will not steer you towards fraud and a potential jail term

theartfullodger

Now we are told get a buy-to-let on our house, even though we aren't intending to let it.

If you were told that whoever told you is a crook: Find someone else... but...

- if you were told to raise a mortgage on your own home & use the money on the rental property (not quite the same thing) that's legal- probably.

Talk to a few big B2L brokers (find 'em wiv Google...)

Nicotom

Thank you both for your advice. I didn't feel comfortable with BTL based on our house. But BTL seems the only route which would take projected income into account. I'll contact some BTL brokers as suggested - perhaps they know of some BTL lenders who will consider our type of circumstances. Afterall the LTV is good.

herbiesjp

As stated above you would get a residential mortgage on your house (as it is your main residence ) not a BTL.

BTL is not the only route

Not sure if you have understood the previous posts

Nicotom

Thanks for your concern Herbiejsp. The Artfullodger suggested that I contact a B2L broker - which is buy-to-let isn't it? I realsie that I can't base it on our house when we are to spend it on a different building, unless there are some flexible B2L lenders out there!

As I haven't given my income details you may not be aware that our joint income will not be sufficient to raise the amount needed based on the 4.5 times calculation on a traditional residential remortgage. My understanding is that as a mortgage type product would offer the lowest interest rate, I would need to raise as much of the 200k as possible through a mortgage route. Any additional amount needed may have to be a business loan based on projected income from the property. Undoubtedly this be harder to obtain in the current climate and would cost more.