New mortgage needed for 2nd house. Already refused

jack0212

We are currently in the position where we need to re-mortgage our house to borrow extra funds. Our house is currently worth £220000 and we want to borrow £136500. We have to base this on my OH's income of £34000. The problem seems to be that we have a second house which we currently rent out. Our mortgage on this is £408 a month but we get £450 rent so it effectively pays for itself. We applied for a mortgage with the Chelsea Building society as they had a deal that seemed better than others but they told us that we were only allowed to borrow £45k which is a lot less than our current mortgage at the moment. On further investigation It seems to be that they along with others are taking the buy to let mortgage into the equation when deciding how much we are able to borrow. Does anybody know how to overcome this? Our current mortgage is with the Halifax who have just upped their rates. Even if we can't borrow any more money it would certainly be nice to change our current one which may lower the monthly payments.

kingstreet

There are lenders who will ignore the buy to let in the background. I'd put this to a good whole market or independent broker to get the best deal.

Since Chelsea became part of Yorkshire BS its underwriting has been tightened and you were unlikely to get such an application through with them.

For what purpose is the extra borrowing?

jack0212

We would like to pay off a couple of credit cards and then are looking at expanding a new business.

The_J

Whoa there cowboy. Not many lenders are going to be happy with capital raising for business purposes.

Dave_Ham

This has broker all over it - please get some decent professional advice to make this happen.

Additionally, you may need to reset your expectations from rate to most suitable product you will achieve.

There may not be too much between these, but you will not be getting the headline deals.

I wish you well...