Let to buy - what type of mortgage do I need?

Blodwen

Hi all, hoping for a bit of advice re. let to buy. My partner and I are currently living in my house (mortgage in my name and paid solely by me atm), which has around 40k left on the mortgage and 50k in equity. We want to buy somewhere bigger between us (around 150k) but keep the old place as it's ideally situated for renting to students and it seems pointless to sell if we don't need to. The price range we are looking at is fine for our salaries and the deposit would come from the equity in the old house.

My main concern is the type of mortgage required. Presumably for the new house it'd just be a normal residential mortgage, but would the old one have to be changed to buy to let? I thought not, as it isn't strictly buy to let and we're in a much more secure position than that, but let to buy doesn't seem to exist anymore! We saw a mortgage advisor in a bank yesterday but she didn't really seem to understand the concept so never answered any of our questions. I understand that if we wanted to rent it out we'd have to get permission from the lender - does anyone know how likely this is? And if they made us remortgage, would it have to be a buy to let mortgage?

I have other questions but will leave it at that for now!! Thanks for reading

JA1000

Phone your lender and ask about consent to let.

See a broker about your other options.

All done.

VIGILANT22

quote We saw a mortgage advisor in a bank yesterday but she didn't really seem to understand the concept so never answered any of our questions.:)

No surprise, often in banks you see a customer service adviser, the bank's name for a data input operator...They input your details and out pops a mortgage...this service in known as information only...meaning no comeback as advice has not been given........ Also they can't think outside the box!

When you go to a bank you're restriciting on what is available to you, as they can only offer you their own brand...ie if you go to Abbey, they cant offer A&L if it was more competitive....

See an experienced whole of market adviser...who will guide you as to the best route to follow

Let to buys are still available up to 85% LTV

Read this for claiming interest on how to get tax relief on main residence as well as investment property....

http://www.hmrc.gov.uk/MANUALS/BIMMANUAL/bim45700.htm

VIGILANT22

JA1000 wrote: »

Phone your lender and ask about consent to let.

See a broker about your other options.

All done.

If calling existing lender re consent to let don't make any decisions regarding this until you see an adviser to discuss the new property ...due to the fact you intend to release equity in your current home.....

Blodwen

Thanks all, good advice.

Vigilant - We thought it would be a bit of a waste of time seeing someone in a bank for both the reasons you mentioned, but we were in there anyway and she spotted us looking at a mortgage rate leaflet so thought we might as well see what she had to say.

Has anyone asked their lender for consent to let? Presumably all lenders are different but just wondered if generally it was the norm for them to say yes or no. I read something earlier about someone being allowed for a year while they tried to sell the property but have no idea what usually happens when it is long term.

Thanks again

VIGILANT22

As I posted be careful, applying for consent to let and applying for consent to let and release equity are 2 entirely different things..

Lenders criteria differ......

Blodwen

I didn't realise there would be such a difference so we'll definitely take this into account and see an expert. Many thanks!

VIGILANT22

Blodwen wrote: »

I didn't realise there would be such a difference so we'll definitely take this into account and see an expert. Many thanks!

Sorry if my posts are "lazy" and not explaining all....shifting between screens!!......If you can imagine you request consent to let....then go back and request further advance, which they may refuse, then yr stuffed!!...

Blodwen

Ah, I see what you mean - need to tread carefully I think! Or find someone who'll let us do what we want!