2nd Property Question

babalooty

Hi all,

We have a house which has a £70k secured loan attached to it. We would like to sell this house but cannot due to the current market conditions. We currently rent this out while we relocate to a new area for my new career opportunity. If we sold this house we would have approx £30k left over after paying off the secured loan.

My new firm have offered to pay me a bonus as a deposit on a house in my new area. Obviously I would need to take out a separate mortgage for this new house.

Can anyone tell me if I would have problems securing a second mortgage for this new house given I still have a secured loan on my 1st property?

Many thanks

G_M

Since you already have a mortage on the existing property as well as the secured loan, is it a Buy To Let mortgage? Assuming the rent/repayments are acceptable applying for a new residential mortgage should just be a question of salary etc.

And if not BTL I assume you have Consent To Let?

If your current mortgage is residential (with CTL) you might have more difficulty.

Don't forget the tax implications, though these may already apply and not change.

babalooty

The mortgage on my 1st property is not BTL it is consent to let.

brit1234

babalooty wrote: »

We would like to sell this house but cannot due to the current market conditions.

What market conditions are these, do you mean falling house prices? Houses will sell if priced right.

If you can't afford to drop the price on your existing property surely buying another whilst renting out your existing is dangerous as you will lose equity in both.

At the moment there are a lot of sellers who aren't selling because they are priced too high. They are blaming the lack on sales on a poor market rather than overpriced. Now they are falling for all the vested interest buy to let propaganda not realising it holds great dangers and risks far higher rates of repossessions.

To the original poster what will you do if house prices fall 10-20% on both your properties?

PasturesNew

Why is the bonus only available to use as a deposit on a house?

Surely a bonus is earnt from meeting targets.

00ec25

PasturesNew wrote: »

Why is the bonus only available to use as a deposit on a house?

surely a bonus is simply additional taxable pay, what the employer calls it and what they base it on (and how the employee spends it) are irrelevant

however, if the money was part of a formal relocation package then the first £8k is tax free provided it is spent only on specific costs, but deposits are not one of those costs

HMRC here