Mortgage - wife??

kingstreet

I spent ages writing a response last night. I covered all the options and the pros and cons of each and just before I pressed submit, Chrome managed to lose all the text.

Linking the purchase to a BTL product is going to be problematic. Going on from what Jimmy said, at 85% LTV The Mortgage Works, for example, uses 6%pa to calculate the interest.

So, £75,000 x 6% = £375 per month.

Rent required = £375 x 125% = £469.

Remortgaging the 1st property onto BTL might be marginally better, but still very close on rental value. £75,000 x 5% (as it's 75% of Property 1 value) = £312.50 x 125% = £391. It wouldn't take much for the surveyor to down-grade the rental income valuation.

We have other potential solutions, like a transfer of equity on property 1 into joint names and Resi remortgage of the unencumbered property but at some point we have applicant one's CCJ to try to square. The combo of adverse credit and unencumbered property won't be helpful.

I've got to the point where;-

b) it's cheaper to get a 'normal' mortgage on property 2 and move in there whilst, we let out property 1 instead

is looking the most potentially successful option. Buy property 2 in wife's name on residential basis. Let property 1 to generate rental income.

I have to say I agree with ACG. Go see a whole market or independent broker.

opinions4u

Mortgage - wife??

Can I mortgage my wife?

Does that mean I can raise lots of money up front and somebody else then has to fund her spending too?

I can see a win / win here. And more watching of Sky Sports in the family home.

JimmyTheWig

kingstreet wrote: »

Buy property 2 in wife's name on residential basis. Let property 1 to generate rental income.

But in this case there would be no mortgage in place that was taken out to finance the purchase of the property being let out. Which means, I believe, that the mortgage interest cannot be offset against rental income for tax purposes. Am I right? Which means tax would be due on most of the rental income.

kingstreet

I believe the OP should seek professional advice on that Jimmy.

Although I have not done so myself, I understand a good accountant can present a case to HMRC for relief as the property cannot be made available for letting without the owner being able to purchase an alternative property in which they will live.

Therefore the mortgage interest payments can be held a direct consequence of the individual using the other property as a means of generating an income on which they will pay tax.

Like I say, I've never done it so professional advice is the way to go...

TrickyDicky101

opinions4u wrote: »

Can I mortgage my wife?

I asked my bank if I could mortgage my wife - they suggested I just tried to rent her out instead