Buying Another Property without selling existing one

Italiaboy

Hi,

I hope you can supply me with some advice.

We have been looking to move home but have so far been unable to sell our present property. The property is valued at £200k and we have no mortgage on it.

We have though now seen an ideal house for our family.

Although I would prefer to sell our existing home and purchase this new house,I know this is extremely unlikely in present climate. So therefore, what are my options to purchase this new house?

Is it possible to obtain another mortgage for the new house as my main residence? Could I use my existing house at collateral (thinking of renting it out). Would this lower my mortgage payments at all? or as I dont currently have a mortgage would the lender even care at all, despite the fact I have a substantial asset under my ownership.

Cheers for any advice as really confused by options that I may or may not have.

Italiaboy

G_M

Italiaboy wrote: »

Hi,

I hope you can supply me with some advice.

We have been looking to move home but have so far been unable to sell our present property. The property is valued at £200k and we have no mortgage on it.

We have though now seen an ideal house for our family.

Although I would prefer to sell our existing home and purchase this new house,I know this is extremely unlikely in present climate. So therefore, what are my options to purchase this new house?

Is it possible to obtain another mortgage for the new house as my main residence? Could I use my existing house at collateral (thinking of renting it out). Would this lower my mortgage payments at all? or as I dont currently have a mortgage would the lender even care at all, despite the fact I have a substantial asset under my ownership.

Cheers for any advice as really confused by options that I may or may not have.

Italiaboy

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Any new mortgage on a main residence would be based on the cash deposit you invested in it and the level of your salary and ability to pay. You may be able to convince a lender to take into account all your income, including rental income. However the catch is that you have currently no such income.

Speak to an IFA.

Eric1

Italiaboy wrote: »

Could I use my existing house at collateral

I don't know, but I suspect that if your property is valued at £200k by an estate agent, it will be valued lower as a collateral, at a realistic sale price, plus you will pay for the convenience of not having a cash deposit.

Jackinbox99

You have several options here.

Firstly for the new house, there is no reason why you cant get a mortgage and buy it. But you will obviously need a deposit for that new house / mortgage - which will probably be around 20% of the mortgage you need.

If you have enough money saved up for a deposit, then fine, you can just use that, keep your current house mortgage free and rent it out.

If however you dont have enough cash saved up for a deposit, your only option would be to remortgage your current house as a buy-to-let, then use that money towards a deposit on the new house. You`d end up with 2 mortgages, but hopefully the rental income from the rented one will cover the mortgage payments.

When it comes to mortgages, the lender wont care that you have a house worth 200k sitting there unless you are going to remortgage it and use that cash to help you buy another property.