Can I remortgage current home to purchase a BTL?

Pipjo

I hope I get some help as in this difficult situation as I don't want to make wrong decision for my disabled child's future.

My mortgage is nearly paid off. I enquired about BTL at bank, but told I do not earn enough money as minimum wage is 20K.

I have found a lovely ground floor flat in secure location that I know when ready my child would be safe their when an adult.

I would initially rent it out and told by estate agent it is 8% return as popular area with gym, pool, gated, security 24/7 etc so will appeal to many single people.

So if I can't have BTL mortgage...???

Can I remortgage my current home to pay for it? I owe 10K currently and my home is worth 200-210K. The property is 70K. I am in my 40s so looking at 20 yrs borrowing.

Do I look to remortgage my current home?

If not, what can I do as I know I could grow old happy knowing my disabled dc will be in safe place to live as an adult.

I hope someone can help as I need somewhere for my son to go and be safe and happy when his old mum is gone. No other family etc so the worry is huge!

Please help

ACG

Yes you can do it, but you need to find the right lender as a lot of them do have minimum incomes of £20-25k. You will need a broker for this.

holly_hobby

Any remortgage on your own home (even to fund a BTL) will initially be based solely on your income (earned and with the inclusion to a higher or lesser degree of some DWP benefits).

There are BTL lenders that don't have the min income requirement, although there is other criteria re max borrowings, and you'd also need to consider that you will require circa 25% deposit - so an equity release exercise on your primary residence may still be reqd.

What is your income, and its sources.

Hope this helps

Holly x

Pipjo

Thank you ACG. This is good to hear! I earn 17K a year as cant work school holidays etc as childcare for my child is £30 hour otherwise.

The estate Agent has put me in contact with a broker ??Countrylife? I think they hopefully will find me a mortgage fast for a fee.

I know my dc would love this place and it was the first hospital I ever worked in 25 years ago with beautiful secure grounds.

Fingers crossed I can secure it as the future is such a worry for me.

ACG

Countrywide? - Is it bridgfords your using?

To be honest, we usually say on here to avoid estate agent brokers but if theyre doing what you need then thats good enough.

Pipjo

Thank you Holly.

I don't have 25% for mortgage

They did not take into account my CTC/WTW or CB. They said they would only take CSA into account which is £0.

I was really hoping my current strength of current mortgage would have helped? I was wrong.

So will this be a remortgage or a BTL mortgage? If I can get one at all <sob> I have not slept since Friday worrying over it all. This place would be perfect as safe for my dc. Scared I won't find another as it is very cheap as repossession.

Pipjo

Ahh yes Countrywide! Just found the leaflet. The appointment is next Saturday but I might try ind broker too.

Is their a brker forum to ask ACG? I live in South Wales area if anyone can recommend any?

GMS

You could look to raise all or part of the funds on your residential property with the rest with a Buy to Let mortgage.

Really is one for a broker this. Countrywide may well not have access to a lender as they operate a restricted panel of lenders.

See what they say and feel free to report back here.

ACG

The easiest way is to probably raise 25% against your existing mortgage and then a btl against that property for the remaining 75%.

Who wont accept the tax credits/benefits? Some lenders do.

holly_hobby

Ok, so you have 17k (solely earned income ? or does this include any benefits ?)

Assuming this is pre-benefit, you should be ok BTL wise re raising the 75% (= £52,500 mortgage).

With an equity release exercise of £17,500 on your primary residence, bringing your total mge borrowings to £27,500 (ie 10k existing & £17,500 for the 25% BTL deposit) - again based on your income noted above this should be ok BUT you'll need to take care re the lender approached, once they know its for a BTL, that they won't want to also format in the BTL mge into their affordabilty matrix, which may throw a spanner in the works - so your adviser needs to consider this as part of the placement process.

But, on the face of things, and as long as you have a clean credit record, then yes they'll be a home for this.

As this will be for your childs residence, you may to consider a repayment mge for your BTL, which means that you'll end up with a mortgage free residence for them.

I would also recommend you write/update wills/care plan, as you have a vunerable adult (if your only child), you will need to consider what will happen to the property and whom will act on their behalf following you pre-deceasing them, and subsequently (unless you want it to go to the crown) what is to become of the flat/any free equity, and other assets on their death (you get the idea) - a solicitor will assist.

As above, if you want to swing by again to discuss what CWide have recommended/suggested, then please do so, or anything else, we're always here to help where we can.

Oh, and as an add on - for a flat (which I assume is in S Wales) must be leasehold (which I assume it is).

Hope this helps

Holly xx

Pipjo

ACG it was Nat West. I have been with them 23 years as a main account holder so they know I don't get into debt on current account etc

I can borrow my dc CB I have saved up. This is about 15% of the mortgage. But no good as 25% needed:(

So I raise 25% on current mortgage and 75% on new mortgage? Do I go through one lender for this? I was looking at First Direct but this was remortgages only in hope allowed too.

Hope I can get a BTL that isn't over the top in rates compared to the others as my low wages and no 25% deposit isn't looking good! I will defo report back on Countrywide for advice on their advice!

So I look to remortgage 25% with one lender on current home then find another lender that does BTL to get the rest 75% mortgage? Natwest mentioned this method but said they could not help me until my earning were over 20K a year. But to do that I have to increase my hours which their isn't any scope to do this!