Freeing Up Equity

Jay1b

Hi

I brought a house in April with a mortgage from Abbey National. At the time I got a mortgage for exactly 4 times my salary and a huge deposit. My tie in to this mortgage is 2 years, so i have just over a year left.

I'm due to have a payrise of at least £5000 within a month or two. Ideally I would like to extend my mortgage by £20,000 taking it back upto 4 times my salary. This £20,000 i'll be investing this £20,000 in a buy to let.

Will Abbey National do this free of charge or for something silly like £35? Or will they not allow it? If they do do it, are they going to force me to stay with them for another 2 years?

Thanks for any help you can give. I would just like to point out, I dont need any help regarding the buy to let side of things or views on where the market is going.

Thanks again.

UK007BullDog

They might let you do it, it all depends on the value of the property and the mortgage amount you have now.

You could remortgage, ask for a further advance, get a secured loan. Possibilities are endless depending on the equity you have on your current property and if your income will fit to support it all.

They will charge you more than £35 though, quite a bit more actually.

Also have you checked out the fees you have to pay getting a BTL mortgage and that you need at least 15% deposit or more depending on rental income? And stamp duty, survey, legal fees. BTL mortgages have a hefty fee of around 1.5% or more of the purchase price. The lenders want a chunk of your good fortune and investment.

Do a search on this forum for other posts on this subject to give you an idea.

And have a chat to your lender to see what they would charge you and how they would go about it.

mhay_3

i've just had a client in the same position as you.

if it is a flexible mortgage with the abbey, they will let you drawdown on the same rate for a minimal fee (can't remember it but think it was about £55). this also avoids any penalties in regards to your current deal.

UK007BullDog

mhay wrote:

i've just had a client in the same position as you.

mhay, please amend your signature to show you are an adviser/broker and read the code of conduct.

Welcome to the board!

pioneer

:beer: Its "bought not brought"

Jay1b wrote:

Hi

I brought a house in April with a mortgage from Abbey National. At the time I got a mortgage for exactly 4 times my salary and a huge deposit. My tie in to this mortgage is 2 years, so i have just over a year left.

I'm due to have a payrise of at least £5000 within a month or two. Ideally I would like to extend my mortgage by £20,000 taking it back upto 4 times my salary. This £20,000 i'll be investing this £20,000 in a buy to let.

Will Abbey National do this free of charge or for something silly like £35? Or will they not allow it? If they do do it, are they going to force me to stay with them for another 2 years?

Thanks for any help you can give. I would just like to point out, I dont need any help regarding the buy to let side of things or views on where the market is going.

Thanks again.

mhay_3

sorry, didnt plan to come on here to give advice, just got sidetracked, all changed now though

Jay1b

pioneer wrote:

:beer: Its "bought not brought"

Did you mean?
It is "bought" and not "brought"

---

Ok thanks guys. I'll try to get into Abbey and speak to them about it. Unfortunately working 6 days a week doesnt give me hardly any opportunity too. And i dont want colleagues over hearing so i cant phone, hence why i posted here.

As for the buy to let. A friend of mine has a portfolio of 114 houses throughout the country, he has basically told me to have 15% deposit, £1.5K for fees and things like the gas certificate and about 4 months worth of rent. I'm guessing he knows what he's doing

mhay_3

just hope he doesn't plan selling them all at around the same time, that would be a CGT bill i wouldnt like to see