Let to buy? How does it work?

theslickking

Hi Guys, new here today ( be nice please!):beer:

Let to buy.

I have a flat worth £190K.

Mortgage is £77K

Owe £20K on other things.

I can get about £800.00 a month for the flat - mortgage is £400.00 a month. I have seen a flat for £330K and want to know if I can afford it on a let to buy, whats the criteria??

I earn £33K a year.

Sorry if vague, can anyone see a way I can get the new place with my finances? Cheers and hello!

:beer:

somethingcorporate

Not with those figures.

beecher2

Even if you sold up and put all the money into the deposit, you'd be asking for a mortgage of over 6 times your salary, with debts of 20k. Can't see how the numbers can stack up.

theslickking

Sorry, meant flat is £300k - still n chance?

Even with the £400.00 profit on rent?

Thrugelmir

Your first objective needs to be clearing your other £20k of debts.

As the management of your personal finances will be called into question.

theslickking

Ok, If I absorb the £20K into my mortgage would that be more favourable and allow e to purchase the flat with the fugures mentioned?

theslickking

This is LET TO BUY... not buy to let.

Thrugelmir

theslickking wrote: »

Ok, If I absorb the £20K into my mortgage would that be more favourable and allow e to purchase the flat with the fugures mentioned?

You may find your choice of lenders restricted. Many lenders are no longer consolidating unsecured debt into remortgages. Suggest you ring your current lender and find out your options.

theslickking

Thrugelmir wrote: »

You may find your choice of lenders restricted. Many lenders are no longer consolidating unsecured debt into remortgages. Suggest you ring your current lender and find out your options.

Thanks guys, I was offered an additional £20K overdraft that I can use to clear the other stuff. so might bsee what they can do for me on that front. Any other advice gratefully received!

:beer:

somethingcorporate

The sums are quite straight forward.

You'd have 2 houses:

300k (main residence) + 190k (let to buy flat) = 490k
+ 20k debt
= 510k you need to cover.

You have 113k equity leaving you 397k to mortgage.

On an income of 33k salary + 10k a year rent it is not going to see you be mortgaged to anywhere near this level of borrowing.

Financial suicide as far as I can see.

If you sell up and just have a single place at 300k you would still need to borrow 6+ times your salary which would be impossible for you to do in the current climate and also crippling on your personal finances.

300k flat + 20k debt - 113k equity = 227k mortgage (7 times your current salary). Forgetting all the fees of buying and selling.

You don't have the income to support such a plan, sorry.

theslickking

somethingcorporate wrote: »

The sums are quite straight forward.

You'd have 2 houses:

300k (main residence) + 190k (let to buy flat) = 490k
+ 20k debt
= 510k you need to cover.

You have 113k equity leaving you 397k to mortgage.

On an income of 33k salary + 10k a year rent it is not going to see you be mortgaged to anywhere near this level of borrowing.

Financial suicide as far as I can see.

If you sell up and just have a single place at 300k you would still need to borrow 6+ times your salary which would be impossible for you to do in the current climate and also crippling on your personal finances.

300k flat + 20k debt - 113k equity = 227k mortgage (7 times your current salary). Forgetting all the fees of buying and selling.

You don't have the income to support such a plan, sorry.

Not disagreeing with you, but a friend started out with £70K equity and managed to get himself 3 properties out that using the rent from one etc to buy another. He earned £25K a year.

:T