Remortgage our own home or take out a buy to let mortgage?

uropachild

We have the chance to buy a smaller property in order to rent it out. Using some cash we have and combining it with some equity in the value of our own home we would have enough to buy it.

Are you allowed to remortgage your own home to buy a house to rent out? Or do you have to get a buy to let specialist mortgage product?

Many thanks.

Simon_gloster

You can do it the way you describe by way of a further advance.

There are pros and cons to doing it this way.

Pro : you have one lender one payment therefore easy to manage.

Con: when declaring the income to HMRC you'll pay income tax on the full rental you recieve. If you got a BTL mortgage you could offset some of the mortgage interest against rental....OP the choice is youra.

This is only the tip of the iceberg but gives you a general idea....oh you'll have valuation, solicitor (non mortgae a little less) and possibly product fees.