Is remortgage possible on a cashed property?

del_piero_3

Just a quick question.

I am 33yrs of age and have a mortgage on my current home. I want to borrow 40k on a another property that I own worth 90k. This property is mortgage free/cashed). Can this property be remortgage? can I apply for remortgage rates etc?

I have checked and I can get 2nd mortgage of around 70k.

kingstreet

Your ability to remortgage the unencumbered property would depend on the purpose to which it is put.

If it is simply a second property, any mortgage would have to be based on your income and then your other mortgage and credit commitments would be taken into account.

If it is let, you may be able to borrow upto 75% of its value, subject to the rent being 125% of the monthly mortgage interest at perhaps 6%pa.

So, it depends.

del_piero_3

kingstreet wrote: »

Your ability to remortgage the unencumbered property would depend on the purpose to which it is put.

My mother lives in the unencumbered property, rent free. I want to borrow 40k (60% +/- LTV) on this property for renovation and also to pay some towards my current mortgage to bring my LTV to 60%.

So both properties will be 60% LTV, so I can get better rates etc. I hope it makes sense.

I have checked what I can borrow for second property taking everything into consideration i.e. debts, out goings, dependents. Rough figure is about 70k but I only need about 40k.

GMS

Family living in the property makes it a regulated mortgage contract and subject to affordability checks rather than income for almost all lenders.

The income source and amount could well kill the deal.