Want to put my flat on BuytoLet and transfer existing mortgage to buy new home

notthill

Hi I have a flat ideal as a rental investment but need to move asap. My bank have already advised me I can transfer my existing mortgage with me when I move but I wanted to consider if I can move my flat to a buy to let mortgage and then transfer my mortgage to buy somewhere else?
Has anyone ever done this? Do I need to get a mortgage broker in order to do this?

I would like to take out some equity when I move to put towards my existing mortgage when I buy the new place.
At what price would the buy to let be calculated?
Would it be like buying from myself at market value or like a remortgage, where the mortgage company values it?
Is there any buy to let mortgages that base the loan amount on rental income or are they all based on LTV like normal mortgages?
Any info before I try to find a mortgage advisor that can help would really help

macgirl

Hi Notthill

We're in the process of doing this at the moment. We decided to use a broker as my OH is self-employed so it was more complicated.
We currently live in the property we are going to let and are using equity from that as a deposit for our new house.

Our current house will be mortgaged as a BTL to pay off the existing mortgage and raise the capital for deposit. The BTL mortgage is calculated on rental income vs. mortgage monthly repayment. We are porting our current mortgage and taking out the remainder with our current lender. I did ask them if we could borrow the extra and take out a new mortgage for the new house elsewhere - but they wouldn't release as much equity as we needed, so the BTL has gone elsewhere.

I found our IFA through unbiased.co.uk as recommended by Martin. HTH

Thrugelmir

BTL mortgages are normally advanced on a maximum LTV of 75%.

Rental income to be 125% of monthly mortgage charge.

Also many BTL mortgages now carry a product fee thats a % of the mortgage advance, starting at 1.5% then rising upwards.

Always crunch the numbers with BTL, and decide what your purpose is with the property. Whether you are looking to make capital gain or hold the property to provide a rental stream in retirement.

rich987652

notthill wrote: »

Hi I have a flat ideal as a rental investment but need to move asap. My bank have already advised me I can transfer my existing mortgage with me when I move but I wanted to consider if I can move my flat to a buy to let mortgage and then transfer my mortgage to buy somewhere else?
Has anyone ever done this? Do I need to get a mortgage broker in order to do this?

I would like to take out some equity when I move to put towards my existing mortgage when I buy the new place.
At what price would the buy to let be calculated?
Would it be like buying from myself at market value or like a remortgage, where the mortgage company values it?
Is there any buy to let mortgages that base the loan amount on rental income or are they all based on LTV like normal mortgages?
Any info before I try to find a mortgage advisor that can help would really help

I'm looking to something similar on my current house, as we are moving to a new area. I would recommend that you do see a mortgage advisor as soon as possible as no reason to delay really.

As Thrugelmir advised, the equity available to withdraw from your flat (for use as a deposit in the new property) must ensure the mortgage doesn't exceed 75% of the valuation of your flat.

My plans are to go for 2 interest only mortgages (obviously one on a buy-to-let principle) -as I can cover the interest only mortgages payment periods with rental income as I'm lucky to live in an area with a high demand for rental properties.

For the property you intend to purchase, I would consider an Offset mortgage so that you can put money in there each month as a means of repaying the capital but still giving you access to some funds in an emergency.

The Buy-to-let mortgage would be at higher interest rates but to me there the key is that you can afford not to have the rental income from your monthly incomings. Strictly speaking, what you are doing is actually let-to-but rather than buy-to -let.