Buy to let and new mortgage

Vixi

Looking for some advice so very grateful in advance for anyone who can help!

OH and I bought our home 7 years ago and have a mortgage with Halifax and are desperately trying to sell our house (as I'm 8 months pregnant).

We have a mortgage promise with Halifax allowing us to borrow £272,000. Our current home is valued at £110/115,000 with £100,000 mortgage. Home we want to buy is around £200,000 and we have £35,000 deposit - could stretch to £40,000 at a push.

Really stressed about not havin sold our house and wondered if it would be possible to rent our current home out (rental market quite good in this area) and buy the new home?

Does the mortgage promise figure work like this or would we really need more equity in our current home to do this?

Thanks!

Dave_Ham

Quickly sit down with a decent broker and run this through in detail.

What you require is consent to let from Halifax and they would have to agree to this. It is only viewed as a short term solution, so would be unwilling to grant consent to let purely as you are struggling to sell quick enough.

Presented in an appropriate way, this can be done but obviously you may want to consider where your deposit is coming from.

Speak to a professional and potentially save yourself money and heartache in the long term.

All the best...

bigsooze

I actually enquired about this very thing with Halifax today. They will grant consent to lease in some circumstances, but they are asking for a minimum loan-to-value ratio of 75% so I don't think you would currently have that much equity in your house. They also asked that the monthly rent fully covered mortgage costs + any management fee or ground rent + house insurance. The interest rates weren't great to be honest, about 6% with an arrangement fee of about £1k so it's not a cheap option even if they did agree to it.

I would say look for other lenders but when I spoke to a broker today he said 75% LTV is the absolute minimum you could get a mortgage at.

Dave_Ham

bigsooze wrote: »

I actually enquired about this very thing with Halifax today. They will grant consent to lease in some circumstances, but they are asking for a minimum loan-to-value ratio of 75% so I don't think you would currently have that much equity in your house. They also asked that the monthly rent fully covered mortgage costs + any management fee or ground rent + house insurance. The interest rates weren't great to be honest, about 6% with an arrangement fee of about £1k so it's not a cheap option even if they did agree to it.

I would say look for other lenders but when I spoke to a broker today he said 75% LTV is the absolute minimum you could get a mortgage at.

Hence why I said sit down with a decent broker.

Unfortunately this is wholly inaccurate and a decent broker will not only make this happen, but with cost savings to yourself.

This is applicable to OP and last post...

Good luck