Mortgage Experts::: Is this possible??

katrina1979

Looking for a bit of advice. I earn £25k per year, have a current mortgage of £58k house now valued £72k.

I work in the Financial Services therefor can borrow 4x my Salary. I have seen another house for £55k i would like to buy and live in whilst i rent my other house out to cover the mortgage which is £269 per month. I could rent this house out for £380 pcm.

Is this senario possible. Dont want to ask my colleagues as yet as early days and the walls have ears where i live lol:rotfl:

Thrugelmir

katrina1979 wrote: »

I work in the Financial Services therefor can borrow 4x my Salary.

Does that make a difference?

Do you have a deposit for the new property?

If your comparing the rental income to the mortgage payment as a basis for your decision. Suggest you take advice before proceeding. You work in the right place to get it.

getmore4less

You want to start a letting business so do a business plan.

There is a lot more to this than just getting a loan.

Gross yield of 8% which is fairly good these days so thats an OK start..

grogdog

katrina1979 wrote: »

Looking for a bit of advice. I earn £25k per year, have a current mortgage of £58k house now valued £72k.

I work in the Financial Services therefor can borrow 4x my Salary. I have seen another house for £55k i would like to buy and live in whilst i rent my other house out to cover the mortgage which is £269 per month. I could rent this house out for £380 pcm.

Is this senario possible. Dont want to ask my colleagues as yet as early days and the walls have ears where i live lol:rotfl:

the simple answer to your question is Yes it is possible. so long as you have deposit available for new property.

herbiesjp

In theory yes - but working in financial services does not make the hoops easier to jump through.

Plenty of criteria that needs to be met.

Are your colleagues mortgage brokers?

katrina1979

Thanks for the replies. Dont really want to start a business, i want to buy the other house too live in as its bigger for my family.

I only intened to rent my own house out due to the downturn in the housing market, where i live its virtually impossible to sell at the moment:(

So i thought i could pay mtg one with the rent and pay mtg 2 through my salary??

Thrugelmir

katrina1979 wrote: »

I only intened to rent my own house out due to the downturn in the housing market, where i live its virtually impossible to sell at the moment:(

Drop the price if you wish to sell.

maninthestreet

katrina1979 wrote: »

Thanks for the replies. Dont really want to start a business, i want to buy the other house too live in as its bigger for my family.

I only intened to rent my own house out due to the downturn in the housing market, where i live its virtually impossible to sell at the moment:(

So i thought i could pay mtg one with the rent and pay mtg 2 through my salary??

Your current property is worth £72K, but is smaller than a property only worth £55K?? That could only be the case if there was something badly wrong with the £55K property e.g bad location, in need of urgent repair, etc. When did you buy your current property, and how have you arrived at your £72K valuation?

katrina1979

maninthestreet wrote: »

Your current property is worth £72K, but is smaller than a property only worth £55K?? That could only be the case if there was something badly wrong with the £55K property e.g bad location, in need of urgent repair, etc. When did you buy your current property, and how have you arrived at your £72K valuation?

Private sale and needs modernisation through out hence the lower price.

£72K valuation has come fro a survey i have had done.

Wh05apk

To cut through all the "judgemental" comments, yes it is possible, as has been said you will need a depsoit on the new property, and consent to let your existing one, once you have that, the new lender will normally disregard your existing mortgage, provided the rent covers the mortgage with some surplus.

Just be careful, as you will be stretching yourself, if you cannot rent your property, will you have income to suppor both mortgages and your family?

getmore4less

katrina1979 wrote: »

Thanks for the replies. Dont really want to start a business, i want to buy the other house too live in as its bigger for my family.

I only intened to rent my own house out due to the downturn in the housing market, where i live its virtually impossible to sell at the moment:(

So i thought i could pay mtg one with the rent and pay mtg 2 through my salary??

Well you might not want to start a buiness but that s what you are planning.

Got the yield wronga bove it is only 6% on 72k and 380 rent, whats the mortgage rate?

6% gross yield is just ok so might not be atractive to an investor that does want to have a business, so to sell it will need to be priced well.
£72k might be too high.

OK you rent it out,
you will need concent to let
you will need upto around £10k to buy the new place for deposit and costs

do you have both of these?

Yu might end up with 2 houses losing value