Let to buy and new mortgage!

rndb

Can you more mortgage savvy people help me out please?

We need to move house. We're having trouble selling our house (although have only been on market 2 months) but need to move sooner rather than later since we live in a 3 storey town house and I'm now disbale following an accident so am having difficulity with the stairs.

Our current lender will allow us to let our current house out and the rent would easily cover 125% of the payments.

However we'd like to ideally port our mortgage to the new house, with top up additional borrowing.

Questions are;

1) Presume we won't be able to port our exisiting mortgage without selling the house first
2) Does top up borrowing need to be with existing lender or coudl we port the mortgage to new house and borrow additional money with another lender (depending on which lender, existing or other, had most favourable rate
3) If above were possible could we borrow the top up (call it a top up but would actually be more than existing mortage) on interest only rather than repayment for few years?

thanking you in advance!

Thrugelmir

Do you have the deposit to buy the new property without selling your existing one?

Simon_gloster

Some lenders you can port your existing rate and turn your existing property into a BTL as stated.

The additional moniea have to be from the same lender on their house purchase range.

Interest only is around, but very very very difficult to get. If you dont meet the int only criteria it is repayment or decined irrespective of any emotives.

Which lender is re interest only varies so much at the moment.

rndb

Yes - depending on how much we buy for, somewhere between 10-15%.

holly_hobby

Interest only - max LTV 75%

Porting - its the mge rate that is ported, not the actual borrowings. you would still need to meet normal underwriting criteria (albeit the rate is applied to the saame amt of borrowings held at the time of transfer). Any additional borrowings is with the same lender, at a rate from their current portfolio.

Notwithstanding the above, your lender may not be happy with the exposure of the 2 properties you will hold mges on with them (the one under consent to let, and your primary residence) so this may not be an option in any event.

Before jumping the gun, speak to your lender tomorrow - explain that you will be looking for a mge on a property which is to be your primary residence. Ask if they would be prepared to accept an application for this, with you in effect holding 2 mortgages with them, and if so would you be permitted to port your existing product to that new residential mge.

If this is agreeable, your existing mge on the let property will probably be placed on svr & a loading (which you should note, will not be an indefinate arrangement and at some point in the future it will be transferred to a BTL mge, or you will be asked to move the mge to a BTL lender (if your current does not market BTL finance).

Hope this helps

Holly

rndb

Thank you Holly - very helpful. What you have said is similar to what a friend was trying to explain to me but wasn't doing a good job at it unlike you!! I did have a tentative discussion with our existing lender today - I think we may come unstuck over the fact that we prob only have 10-15% deposit available for new property,unless we either lower our potential purchase price a lot or beg/ borrow some additional deposit from a relative, because in order for us to have 2 residential mortgages (even if we have agreement to let one) with our current lender the ltv needs to 75% or less.

holly_hobby

Yes - its because they want to limit their exposure which I thought may be the case.

All's not lost, there are plenty of alternative lenders whom will consider you under a let to buy basis at a regular LTV (subject to status), which just means that they will effectively ignore the let property with your current lender for affordability purposes.

A decent whole of market broker will have no probs assisting - check their fee structure.

I wish you well and hope this helps

Holly x