Open question needs open answers

2Tony2

I am currently in the process of accepting a new job offer which will require relocation. As the position is only contracted for two years, I would like to keep my options open by holding onto our present property.

My current thinking would be to remortgage our current house on a buy-to-let mortgage, this would also give us a deposit for our new home.

The numbers involved are as follows:
Current Home:
Expected Remortgage: £60,000 (includes £10k for deposit on next house).
Current Value: £140,000
Expected annual rent: £3,500 (conservative to include any unoccupied periods).

New Home:
Max Purchase: £175,000

New Job:
Circa: £42k per annum

Issues:
My better half will be seeking part-time work but only when we move to our new area.

Questions:
Would it be best to buy our new home initially on 'interest only' given the 2 year window, then consider repayment after that?
Does this make sense?
What would you advise?

Gorgeous_George

I wouldn't let a £140K house for £3,500 per year. I'd need double that at least.

Sell and rent would be my advice.



GG

MortgageMamma

If you want to hold onto your existing property thats totally understandable but you need to be more realistic about the rental - have you thought of getting a local letting agent in to do an assessment

You could look at buy to let or ask your existing lender if they will give consent to let for two years on your residential mortgage

When buying your new property there is a slight income stretch assuming your wife will not have secured permanent workby the time you move. You could look to take out a let to buy mortgage (do not confuse this with buy to let) this basically means that any surplus income from your rental property above the mortgage payments will be taken into account as your income for your new purchase

Based on what you have said so far this seems a good way forward

2Tony2

I had never heard of 'Let to Buy' until you mentioned it. I did a quick search on google and now understand the basic premise.

This seems like a great way forward.

Doesn't seem to be many 'known' providers but need to research this more carefully. Guessing that 'Let to Buy' may be as simple as informing lender at time of quote.

Once again many, many thanks.

herbiesjp

Plenty of high street lenders will offer let to buys - you will need to make sure you meet their criteria for rental cover though

MortgageMamma

Abbey and Northern rock do it as well as a few others

However, its not as straightforward and simple as it seems, so I would suggest you consider using a broker

MM