Mortgaging a Second Home

Neilhlm2003

Please help me with this query. I currently have a mortgage of £160,000, with HSBC, on my main residence, valued at £300,000 by them in June this year i.e 53% LTV. I also have a second house that I currently rent out valued at £215,000 which is fully paid for. I want to either (a) Buy another home in the UK to rent out or (b) A holiday home abroad and have asked HSBC would they lend against my second home. They have said no because they only loan against principal residences.

I'm now at a loss as to how to release the equity in my second home without having to pay silly interest rates. HSBC charge 3% APR !for 60% LTV and as I was hoping to only borrow £120,000, on my second home, I wanted to go with them.

Can you advise the best way to get around this, any mortgage lenders you know whom would lend against my second home?

Thanks

kingstreet

You can remortgage the BTL property, but you aren't going to get it at a residential rate. As the rental income from the property is taxable and the mortgage interest can be offset against that rental income, there's effectively a "netting-off" effect which serves to reduce the interest rate somewhat anyway.

There are plenty of sub 4% BTL rates around with a little research.