Renting out current home and buying a second to live in

quidsout

Apologies if this has previously been discussed - there are so many threads here and the interent only tends to cover buy-to-let mortgages for second homes.

Our situation:
- we currently live in a flat on which we still have a mortgage;
- the interest we are earning on our savings is greater than the interest we are paying on our mortgage. Therefore, rather than paying off our mortgage we are continuing to save;
- in the next couple of years we will definitely need to up size and buy a house;
- we would like to rent out our current flat and use the savings as a deposit for our new home (not to mention the stamp duty);
- the flat below us is almost of an identical layout and is being currently rented out so we know roughly how much rental income we could get for our flat. This would more than cover our current mortgage repayments, provided the base rate remains low;
- only my name is on our current mortgage; my husband would be a first time buyer when we buy our second home.

My questions:
- provided the above remains unchanged/stable(!), will mortgage lenders view our flat as an asset or liability when deciding how much they could lend us?
- is it advantageous for my husband to be a first time buyer for our second home, as the 'risk' for mortgage repayments on our flat will legally be all mine?

kingstreet

Lenders will possibly "tax" you the cost of the mortgage on the flat if you let it and want to buy another.

The FTB thing isn't a big issue unless the SD exemption is extended in March. If it is, buying in your husband's sole name would deal with the stamp duty and existing mortgage issues, but he'd need to be able to justify the new mortgage on his income alone.

Before you think of anything else, you need to find out if your current lender will grant you consent to let and start researching the responsibilities of landlords and the tax treatment of rent and expenses.