Mortgage advise

Cats_are_great

Mortgage advise
I own my property outright, I intend to let this house and buy another with the help of a mortgage to live in.

Should I just get a new mortgage on the new house or release equity from the house that I own and intend to rent out?

I am confused over tax relief

Thanks in advance
Last edited by Cats are great

advice_please_2

Do you have enough deposit for new mortgage?

kingstreet

If you have cash of around 25% of the price of the new property, you could raise a BTL mortgage on the purchase. If you don't, you'd have to remortgage the current property to raise that, so you might as well raise it all that way.

Mortgage interest (no capital element of the payments) is allowable as a trading expense against the rental income, along with other expenses, such as letting agent fees, insurance, maintenance etc. It does not matter how the money is raised or what is used for security, it is the purpose of the loan which determines if the expense is allowable.

As always, seek professional advice on tax issues before proceeding.

Cats_are_great

I have enough to pay a 30% deposit on my new home, but would it be more efficient to raise money from the house I fully own?