Second mortgage

MikeEy

Hi

We recently got married and are just about to embark on buying our first house together. Simple enough so far. The slight complicating factor is that I already own a house which I have been renting out for a number of years since I moved down to London to be with my, now, wife. When we moved back up north we decided to rent ourselves instead of evict the tenants in my house. My mortgage is with Santander and is a SVR re-payment mortgage - I paid to obtain a certificate from them originally in 2011 to stay on my re-payment mortgage even though I was letting the property.

I would ideally like to keep hold of my house on a re-payment mortgage but don't want that to affect the amount we can borrow to buy our marital home. I am not sure how best to approach this. I have done a bit of searching around on the internet but haven't so far found anything which tells me what the rules are around second mortgages and the considerations. I am considering making an appointment with a mortgage advisor but don't really want to pay for some initial steer which may take a different direction once I have been given some advice. Can anyone offer me some advice? We need to make a decision sooner rather than later if we are to sell my property.

Many thanks in advance

MikeEy

Dave_Ham

You are likely to need formal advice.

It can be done, but not to every lenders criteria so lender selection will be crucial.

You may well need some formal advice regarding your existing property, as appears you do not have consent to let which could be an issue for part a of the plan.

Depending on the detail though, a rate of 4.74% is not super attractive depending upon your equity so you may be worth moving it in any case.

Best of luck

MikeEy

Hi Dave Ham

Thank you for your reply.

I do have "consent to let" from Santander at the moment - apologies, I didn't make that very clear ("I paid to obtain a certificate from them originally in 2011 to stay on my re-payment mortgage even though I was letting the property").

I've known for a while that the Santander SVR wasn't the best deal on the market but as I had consent to let with them it was always an excuse not to change it (just as they planned, I imagine!). I wasn't sure whether I would be able to have a similar re-payment setup if I did move to another provider.

Dave_Ham

Possibly similar setup elsewhere, depending upon the rental figures and equity.

Either way, many of the buy to let lenders allow overpayments charge free at which point you can technically run it as a repayment mortgage by overpaying on an interest only product.

Good news on the consent though..