secured loan on 2 properties

vinylmatt

Hi, I'm after some advice.

Me and my partner have moved in together and I rent my flat out. We'd love to get a holiday chalet for £40k, but don't want to sell my flat to do so as the rental is making a profit over the mortgage etc.

We would like to get a loan for the £40k (mortgage not an option on the property), but this is obviously daunting! The chalet would be rented out at times and we're pretty certain the rental would cover a lot of the monthly repayments (if not all some months). Would we be able to get a secured loan combining our 2 properties?

CH27

How would you afford the reapyments if neither the flat or chalet are rented out for months at a time?

vinylmatt

My flat has a steady tenant, and even if he were to leave I had enough interest in it initially to know that I would find another tenant quick enough.
The chalet is a bit of "suck it and see" I suppose. We don't know how we'd fare exactly, but the park the chalet is on would rent it out for us (taking their slice obviously), so there is a bit of added security there.
My question is about getting the loan in the first place. My partner doesn't have £40k equity in her property, but between us we do. I know its a gamble, so we've not fully decided on doing this yet - but knowing if it is at all possible would be a good start!

pat1976

How much equity do you have in each property? How much surplus do you have at the moment after paying for your living expenses?

Assuming you can afford repayments and there's equity in the properties there's no reason why you couldn't take out secured loans on both properties. Remortgaging may be a cheaper option though.

As stated above, would you be able to afford all repayments if you couldn't rent the places out for a couple of months?

vinylmatt

pat1976 wrote: »

How much equity do you have in each property? How much surplus do you have at the moment after paying for your living expenses?

Assuming you can afford repayments and there's equity in the properties there's no reason why you couldn't take out secured loans on both properties. Remortgaging may be a cheaper option though.

As stated above, would you be able to afford all repayments if you couldn't rent the places out for a couple of months?

Split the loan then? I hadn't thought of 2 loans :doh:, just 1 loan covering both properties. Two loans would probably mean paying back more though wouldn't it (higher interest rate)?

geoffky

you will get burnt playing with property in these uncertain times..interest rates are going no where but up.

leveller2911

You could try saving up for it instead of buying on the never, never.....................

Crunch, chrunch,crunch.......Popcorn anyone?