Multiple Property Purchases - Mortgage Considerations

gasman82

I hope someone with experience in house buying/mortgages (and perhaps experienced landlords) can help me with my situation. I appreciate I should seek some professional advice at some point, but would like to hear some initial thoughts. I will keep it simple...

I own a flat, which I rent out. It is mortgaged at around 85% LTV and the rental income more than covers the repayment mortgage (and in terms of interest, probably covers more than double the interest element).

I live in a house, which is mortgaged at around 47% LTV. I'm thinking about renting this out too, which I'm hopeful will achieve a good yield and again, more than cover the mortgage (at well above the usual 130% BTL rental requirement).

Now, if I do that, I will still need to live somewhere! I do have a lump sum for a deposit, but the question is, how do I calculate what I can afford/borrow for this new main property? I know I can consider the first 2 properties as their own self-financing 'businesses' but does this therefore mean that I do not need to consider the mortgage interest as a regular outgoing? I'm not saying I wouldn't inform the new mortgage provider they exist, but surely if I am factoring in this outgoing, I should also be able to factor in the income from the properties (i.e. net profit after the mortgage interest is paid on both properties).

I have read conflicting things, some say the Buy to Let should not be considered in respect or outgoings or income providing it self-funds, some saying rental income cannot be included (even after interest deducted) unless the property from which it derives is mortgage free, and some say the mortgage payments must be counted as a regular outgoing regardless.

Sorry if I sound like an amateur (I am!), but I'm very much learning the ropes as time goes on and my circumstances/finances have changed.

Thanks!