borrowing money and letting my house

newforest_3

Hi

We have an opportunity to let our house and move into a relatives house. The new house would be signed over for inheritance purposes to us but we would need to borrow money to build an extension.

How do I borrow this money (£100, 000) when there is no mortgage currently in existance on the new house.? Do I need to take out a mortgage to buy this house but only borrow £100, 000.

The rent from my current house would be used to pay for the borrowed money.

What is the cheapest , safest and legal way of moving.

Thanks

Thrugelmir

You will need to own the new property for 6 months before being in a position to remortgage.

Have you asked your existing lender if they will grant CTL?

The net profit on letting your property will be subject to income tax. So crunch the numbers. This may help in deciding whether selling or letting is the best option.

newforest_3

Sorry what is CTL ?

Thrugelmir

newforest wrote: »

Sorry what is CTL ?

Hi sorry.

Consent to Let.

You will need your current lenders permission to do so.

newforest_3

Thanks

The problem is that I won't need a mortgage on the new house but I do need the money for the extension.

We are still getting advise re the inheritance and the tax implications but the house would be a gift.

Thrugelmir

newforest wrote: »

The problem is that I won't need a mortgage on the new house but I do need the money for the extension.

Your current mortgage lender will need to give their permission for you to let your property.

This may also result in an increased interest rate.