Mortgage for a second home Q's

jonnywells

Thought i would get a quick heads up first before i seriously start looking into thinks.

I own a property outright (fully paid off mortgage) and me and my g/f are thinking about buying a second property for :-

1:- Somwhere nice for her to live (She has to live away 4-5 days a week due to work commitments, currently renting in a room share and dont really like it)

2:- Invent some savings into.

Think might seem a stupid question but can i get a mortgage against our house to help get a better rate? And second i take it if the mortgage is in both our names on the second property would i be liable for capital gains when we come to sell it?

Senior_Paper_Monitor

i) No - although you could do all the borrowing on your current property which would presumably be a lower LTV loan and therefore cheaper and use cash to purchase the second

ii) Yes

Many other options/considerations could come into play

jonnywells

Senior_Paper_Monitor wrote: »

i) No - although you could do all the borrowing on your current property which would presumably be a lower LTV loan and therefore cheaper and use cash to purchase the second

How/which products should i be looking at to do the borrowing on my current property?

Senior_Paper_Monitor

I am assuming current property has higher value than property to be purchased.

If so, any borrowing of the amount necessary will be at a lower LTV on the first property, it will therefore attract better rates.

jonnywells

Yes alot higher in value

Conrad

CGT applies to all non primary residence property. I know that some get around this by notionaly moving into the property 12 months before selling (for example by going on voters roll etc), but I must point out this is illegal.
On he other hand MP's are past masters at this - one rule for them.............

You don't say what the values are or mortgages required so any pointerts on that score are not possible.

jonnywells

Our main home is valued between 200-220k and the value of the property we are looking at is 60k

jonnywells

Just having a quick look around @ what secure loans are around and they are quite abit higher APR then I thought

And none offer seem to offer a flexible repayment option/overpayment

Senior_Paper_Monitor

Borrow 60K against the current property (30% LTV will get a great rate), purcase other property in joint names with mortgage in common and deed of trust in place to handle any future split/disposal.

Chances of any real CGT impact seem minimal on a share of property of that value in current market. Her share of the property will probably be her primary residence.

There may be other tax/inheritance implications depending on your overall personal wealth but presumably you are attending to such issues separately.

Another route to consider is taking it as a buy to let, but probably not worth the bother.

herbiesjp

Should be a pretty staright forward scenario.

Although getting a mortgage on your current property (and maybe benefiting from lender incentives like free valuation and legal fees) don't forget to get a survey done on the one you are buying.

jonnywells

Senior_Paper_Monitor wrote: »

Borrow 60K against the current property (30% LTV will get a great rate), purcase other property in joint names with mortgage in common and deed of trust in place to handle any future split/disposal.

Chances of any real CGT impact seem minimal on a share of property of that value in current market. Her share of the property will probably be her primary residence.

There may be other tax/inheritance implications depending on your overall personal wealth but presumably you are attending to such issues separately.

Another route to consider is taking it as a buy to let, but probably not worth the bother.

Ok so im not looking at secured loans,which im looking at around 11%APR? Like i say its a early stage of looking and just trying to get some advise.

I was of the understanding that if we got a new mortgage it would have to be done with the standard deposit/repayment route. Would be brill if someone could point me to a site with some products which would be suitable