Will we get another mortgage?

devmcc

Hi all.. happy bank holiday!
So, here is the issue:
We are looking to buy a second property - it is a bit of a no-brainer winner!! It needs restoring but we have done this kind of work on all of the properties we have owned in the past. We will just be buying, doing it up and selling - 6 month turn around - hopefully!
Only problem is I am not sure whether we will get a mortgage.
We have a £140,000 Standard Life mortgage on our current property - bought it 7 months ago.. similar ones in the street are now selling for £270k.. at the time we bought we put a big deposit down as we had both been self employed for just 1 year.
We earn around 4K between us each month..
The new mortgage would be for around £200K - does anyone have any ideas as to whether this is possible - also, what the best way around it would be - should we remortgage our own property to put a deposit down.. Also, which lenders would be best to talk to..
Any advice (either way) would be great..

JoeK_3

Can you just clarify one ot two points for me.

Do you have a deposit?
Is the new property in your street?
Is the new property value £270,000?
Do you want a new mortgage of £200,000?
Is your joint income £4,000 pm gross?

Please advise

JoeK

devmcc

Hi there - Thanks for replying... just read my own post and I was typing a little too fast!!!

So:
Do you have a deposit?
No deposit as such but we do have £130k - ish equity in the house we have.

Is the new property in your street?
Nope - it is just down the way - about a mile away.

Is the new property value £270,000?
The property is for sale at £200,000 - would have a resale of about £260,000 when completed.

Is your joint income £4,000 pm gross?
No - this is nett...

Thanks again for any advise..

JoeK_3

Look like a combination of releasing 25% of the £200,000 from your existing property and the balance (75%) would be using a bridging loan.

JoeK

devmcc

Wonderful - would I be best to ask my current lender for both - would they panic if I told them about the new house!!
Thanks again - you are a lending knowledge star!

silvercar

would it be cheaper to get a BTL (actually BTS in this case but same idea)mortgage on the new place. Could work out cheaper than bridging.

devmcc

Sorry to sound a bit thick - what is a BTS (is it Buy to Sell)? I have no idea about lending!!... Is a bridging loan much more expensive than a mortgage??
Does a bridging loan have a set amount of time before it must be repaid??
Thanks again..

JoeK_3

devmcc wrote: »

Sorry to sound a bit thick - what is a BTS (is it Buy to Sell)? I have no idea about lending!!...

I think that the implications are a buy to let mortgage. A buy to let mortgage assumes that you will rent the property out and pay the mortgage back from the rental income.

devmcc wrote: »

Is a bridging loan much more expensive than a mortgage??
Does a bridging loan have a set amount of time before it must be repaid??
Thanks again..

Bridging Loan interest rates can vary depending on the lender used and the loan to value. They are usually for a short period ranging from 1 - 24 months.

The key to your cicumstances is affordability of paying the interest on the £200,000 whilst you are doing it up and a bridging loan would facilitate that.

JoeK