Advise for options for moving home.

charsi16

Hi,

Just wanted to see if some seniors here could advise me. I am looking at some options and am getting more confused by the day.

Due to some circumstances I have had to move out of my previous mortgaged property and am in the position at the moment looking at buying another one..

Some details..
Previous property bought in 2006 - 240k
Current value in the market appx 250-260k
Mortgage remaining on it 150K
On SVR of 4%.
Offset acount has a deposit of 100k

Now I am looking at renting this property as I have moved away. Current lender is willing to give consent to rent. I will expect a rent of 800-850pcm.

Looking at the new property.. it will be in the region of 300k. Have lenders willing to give me 75% or 80%LTV. This will mean that I will have to mobilise the monies from the offset account. Which will be appx 75K and say another 9-12k for all other costs, Stamp duty etc.

1/. What is the best way to go about this? Should I use the money in the offset account and free the previous property? With some help from relatives I will manage to do that. Will lenders be able to lend me 250k for the mortgage free property so that I could use that money to buy the other property? will this help me in any way?

2/. Should I take out a a new mortgage with a 20-25% percent deposit from the offset account? This will mean that I will have 2 different mortages, previous property will have atleast another 100k left on it and the new property will have 225k balance.

3/ Or should I use all the monies in the offset account plus help from relatives say 150k towards the new mortgage ? This will mean the older property will have a balance of 150k...but I will be getting rent which could be paying off some towards the property.

4/.Is there any other way...say I remortage the older property now..and they pay me 100k in teh equity that I have in the property..and that I can combine with the offset monies..and buy the new property upfront with cash?

All advise will be greatly appreciated...

Hope to hear from all who can help..

getmore4less

Duplicate posts you need to delete one.


Getting concent to let is probably the chepest way to borrow against the current property, any new loan would need to be BTL.

If they let you keep the offset then I would probably stick with that.

Then draw down what you need from the offset account to get the bests rate on the new house. Another offset might be the way to go and then you can keep the offset funds where they work best.

Ofsets give you the flexability and buffer to manage the cashflow issues that come from renting.

Might want to get advice on the rental interest offseting agains tax to see if you can claim upto the full value of the rental at the time you let it out.

Your gross yield on the rental is only around 4% so you will not be making any money from the rental side of this business why not sell the place?