A little advice please.

Wardy4

I currently own a house with no morgage that I rent out. It is worth £75,000. I live with my parents.

The house is not in a very good area so i dont want to live there. I do have a good tenant who has been there since I got the house about 3 years now. However she wants to move as its not a nice area.

My plan was to re-morgage the house so i could buy my own house. Then use the rent to pay the morgage.

However the area the house is in does cause me a lot of stress so I am thinking about selling the house. If I did I would buy a new house for £110,000 leaving me with a morgage of £35,000. The current tenant would then move to my new property giving me a good tenant.

But how would this affect my idear of getting a re-morgage? Would I still be able to get one of the £75,000. I have a really good credit rating and a job paying me £10.900 a year.

Or is there another way like puting the house in the name of a limited company and paying my self the money out?

Thank you in advance for any help

holly_hobby

Ok - what you need is a buy to let mortgage (as it is your sole intention to purchase a property for letting purposes).

There is an issue with your income however, as most lenders in this market require a minimum income of 25K (irrespective of the rental income).

As your income is somewhat less than this, you only have a choice of 2 lenders who don't have this min income requirement.

Kensington Mortgages (as you are not a first time landlord) - max LTV 80% - rental income 120% of mge.

The Mortgage Works - max LTV 80% - rental income 125% of mortgage.

You will need to make provision for the mge and legal fess from the funds released upon sale of your current property, and it would be wise to also retain a contingency fund for emergency repairs etc.

Your next step would be to put the property on the market, and take it from there.

Hope this helps

Holly

kingstreet

I'm confused.

In the first place, you are talking about buying a property to live in. Then you jump to selling the rental to buy another rental.

Next, you ask about a remortgage, but don't actually have one to move. Then you blow my mind completely with the limited company idea...

Can you clarify what you actually want to do?

handytips

I think the OP needs to sell the property in the bad area and start with a clean slate, otherwise it could all get a bit confusious !!

Wardy4

Thank you for your replies.

Sorry if I have not exsplained my self very well. Ill try again.

1. I want to sell my house I own in a bad area thats worth £75,000 and I own 100 per cent of it. I currently rent this property out.

2. I want to buy another property for £110,000 and rent it out.

3.A year after doing this I would like to get a remorgage against it and take the money to buy myself a house. I am currently living with parents.

Ideally I would like £75,000 to buy my own house. I will have my wages off £10.900 plus the rent from the house wich I think will be around £5000 after tax.

In any ones opnion/guess am I likely to get it?

Once again thank you in advance for any help