Getting another mortgage when you already have a buy to let mortgage

andrewj2202

My wife and I are currently struggling to save any money towards a deposit for a bigger property. However, we are lucky with the fact we are able to move in with a relative and rent our current property out. We are changing the mortgage to a buy to let and were aiming to be living with my father in law for approx 2yrs. However, our original aim was to sell our property and start again once a deposit was saved but with house prices as they are, we would almost definitely end up in negative equity. My question is this:- How do we stand with getting another mortgage should, say, an opportunity too good to miss come up? How do they work out what we can lend? The rent we will be receiving will not quite cover our mortgage payment on the current property so we need to top that up....Any advice or direction where to look for info would be much appreciated.

PasturesNew

Depending who you're with, you might find they don't allow you to rent it out/get a BTL mortgage because [a] you've not got enough equity (say 25% or more) in the house the rent isn't 1.25x the interest only mortgage.

If you say which lender you're with, somebody might have knowledge of their usual terms and hoops to jump through.

andrewj2202

Thanks for that. Our mortgage is with Northern Rock. We have already enquired and we can change to a Buy to Let mortgage.

kingstreet

If you can save a big enough deposit, getting a new mortgage for a home of your own should be fairly straightforward.

Some lenders will take the value of the mortgage or the monthly payments off your future borrowing power, others will ignore a single buy to let "in the background."

You're going to have to look around at the time as a lot can change in the next couple of years.