Not sure what to do

mrstaypuft

Hello

We have had a bit of a bad run of things at the moment and not sure what to do.

I am £2000 into my £3000 overdraft and have £4750 on two credit cards which I have had to use recently on house repairs (Boiler had to be replaced and the old clay drain pipes have collapsed along with discovering the main water pipe leaking underground and needs replacing!!)

The flat roof needs to be replaced out the back and we want to change this for a pitched roof and convert the garage into another room.

We have a property that we rent out at the moment that has no mortgage or debts against it so we are planning on getting a small BTL re mortgage (can also offset some of the tax then) on this for the work and to clear my overdraft and CCs also to clear the rest of my bank loan £3455.

My problem at the moment is we are switching mortgage lenders on our home via a broker as we are out of our current deal and it is taking much longer than it has done in the past and he has advised not to get a BTL until this deal is completed and this has been going on for over a month.

The flat roof has started to leak a small amount which I have patched up for now with some shed felt but the car needs its MOT and tax this month and it will probably need some repairs for it to pass.

Should I try to ride this out till I get my BTL or re-finance my loan , or will this have a negative effect on any mortgages currently going through and any future ones?

I know the easy answer is to sell the rental and clear everything but that could take a while.

Any advice appreciated

smartiedriver_2

Hi.

If the mortgage currently going through has been agreed and you've had a written offer which you have accepted then the B2L will make no difference at all.

If you are still in the process of applying for your residential mortgage and haven't yet had or returned a signed offer letter then it could potentially impact approval of the residential.

I say potentially because B2Ls are standalone and provided the rent covers the B2L mortgage repayments (plus any additional percentage the bank imposes) then it should still be excluded from your personal income/outgoings.

mrstaypuft

I think I am having problems with the remortgage as I was off work for 2 months last year with a broken ankle so my wages didn't look so great last year my remortgage is about 50% LTV I have had a written offer from my current lender that is approx £15 a month more than my broker has got for me.

It was only my name on the mortgage originally but now I have to put my partner on there too as she is seen as a liability.
They may need to see more of her pay slips etc so this will take up more time.

The BTL will be about 30% LTV and the rental income should be fine.

paddyrg

How about zopa or better still ratesetter for a few grand short term? With ratesetter you pay 1% upfront, and then £5/month, but only pay about 4.5% interest. The fact the fee is monthly may help, but the 1% upfront may make it dearer for very short term. They both only touch good risk customers, and your second place sounds like a good asset to reduce risk!

jamesd

Don't do any new borrowing until you have the mew mortgage money. Mortgage lenders can and do sometimes do another credit check and request for bank statements just before handing over the money.

Using your existing cards in some way would be safer, if there is money usable on them.