re-mortgage advice

shaye_2

Looking for advice/opinions.......

I currently own a house I bought from my mother 2 years back as she was having trouble-paying mortgage. I have I have done a fair bit of work to the house to increase it’s value and I am hoping to re-mortgage it to release money to use as a deposit to buy a house for me and my partner as we currently rent £540pm

Rough figures are......

53,000 mortgage
100,000 est. value (need to get it valued once work completed)

Looking to re-mortgage 75% LTV so releasing 22,000 minus fees to use as a deposit on next property

Looking to buy a property for between 100-130,000

At the moment I pay both mortgage at £270pm and rent at £540 I don’t receive any rent from mum who still lives at house I have mortgage on....

I run my own business and have a wage roughly 30,000 (depending on trade)

I will be looking to see a mortgage advisor once I’ve completed work in house but was hoping to get feedback/advice before I do

Do these figures/plan make sense or is it to risky???

All help much appreciated

CloudCuckooLand

1st house, £100k @ 75% LTV = £75k mortgage. £22k gained.

2nd house, £120k less £20k (less £2k fees) deposit, leaves £100k to be mortgaged.

Total £175k in mortgages. £30k income.

Makes the salary multiple x 5.8.

Pretty unlikely.

Even going for a £100k property will require 5.2x income.

Worth a chat with a broker, to check you have what you need in the way of paperwork to support your self-employed income. And they may have some views on Lenders who use affordability calculation rather than salary multiple.

But it sounds risky to me.

shaye_2

thankyou for the reply

yeh the slary multiple doesnt add up its just the monthly repayments wont differ to much from rough calc of

100,000 @4.5% over 25 yrs = 560

75,000 @ 4.5% over 25 yrs = 420

at the moment i pay 270 and 540 which i have no hassle paying and the £170 shortfall i have spoken to my mother about helping with the mortgage i.e the extra £170 a month

but i see what you mean about the figures not balancing exactly

Annisele

We're currently in a period of historically low interest rates, but your mortgage will likely last a couple of decades.

If you would need your mother's help now for the £170 "shortfall", what would you do if interest rates doubled? Definitely worth having a chat with a broker, but nearly six times income does look unlikely, sorry.