New House

Noddy

Please Help,

I have an existing mortgage with HSBC at 0.48% above base with £120k outstanding on a £150k house. I have found another house for £245k which I would like to put an offer on and I have £100k in savings.

I earn £45k and would like to take out a second mortgage on the new property and rent out the old. HSBC have said they will not take into account any rental income on the second property and hence can't lend me that value (£120k + £145k = £265k).

If I take out an interest only offset mortgage with 1st direct for 25 years would this be a better option as the repayments would be lower and i would only need to put down £90k and pay £390 a month?

Can anyone recommend a good bank who will be willing to lend?

Thanks

Noddy.:)

kingstreet

As HSBC and First Direct are effectively one and the same, the decision making process will be identical. If one says no to rental income, the other will copy.

There are other lenders who will take your first mortgage and treat it as a credit commitment so it doesn't affect your borrowing power as badly and ultimately, you could consider remortgaging your current home onto a BTL at the same time, but this will cost you in terms of monthly payments.

I'd suggest a whole of market or independent broker to work out the best way to approach this.