Re-mortgage current house on BTL and buy new?

madmish00

We have had our property on the market for about 6mths and so far not a lot of interest. A property on the next street to us (which is a dive inside) has been on the market at the same price and they have just rented theirs out for £450 per month.

We currently have a tracker mortgage with a rate of 2.18% (tracks at 0.18% above base with a 2% floor) and are paying £340 per month on the mortgage.

Would it be possible to port this mortgage onto a new property and re-mortgage the existing property BTL? If so would the new BTL mortgage have to be with the existing mortgage provider if I want to port?

When rates were at their peak in 2007 we were paying £524 on the mortgage and given that our property is in much better internal condition than the other I think we could secure at least £500 per month rental. The amount that the bank would be willing to lend on a new mortgage is significantly more than we are looking to borrow and the two mortgages would come in under this figure.

Is this a viable option? I am desperate to move because my partner has started a new job in Manchester and I am part way through the selection process for a job in Manchester and the travel is just a nightmare.

Thanks

BitterAndTwisted

You might be better off concentrating all of your efforts into getting the property sold rather than taking on even more debt.

Becoming a landlord is not simple or straightforward, especially if you live elsewhere and have zero experience.

Converting your residential mortgage to a BTL one will depend on how much equity you have in the property. Some lenders insist on 75% LTV and your projected rental income will be a major factor as well.

poppysarah

Ask if you can stay on the same mortgage if you go BTL with it.

madmish00

Thanks for your reply.

Obviously it is not something I am just going to jump into. Just wanting to see whether it is a technically viable option worth looking into really or whether I am completely wasting my time.

The estate agent is actively discouraging me from dropping the price (even though they are being paid a fixed fee so it makes them no money to hold out for a higher price) but I don't know what else I can really do. Nothing around this area seems to be selling at all but the ones that have gone up for rent seem to have been snapped up pretty quickly.

Mmm why must the property market be so complicated!