Porting or new mortgage when unemployed but with capital

JohnDoe1

Hi,

Is it possible to get a BTL mortgage when unemployed still?

I am thinking of selling my flat for around £350k which currently has a £90k BTL mortgage on it with The Mortgage Works. I will be buying another property for around £220k so will have around £130k excess cash.

Firstly, can I port the £90k mortgage on the new property when I have no earned income (unless they count the rent received from the property I'm about to sell as earned income).

And if they are unlikely to, what are my chances of getting a new mortgage with my circumstances?

Thanks

kingstreet

Porting is moving the rate from an old mortgage with a lender to a new one, if you qualify for a new mortgage that is.

The current mortgage is repaid when you sell, a mortgage can't be moved from one property to another.

You will struggle to get a new mortgage if unemployed and a BTL mortgage for a property you intend to live in is no longer acceptable, so I trust you plan to pay cash for your new residence.

You say you'll sell for £350k, so when your mortgage is repaid, you'll have £260k left. If you buy for £220k for cash, you'll have £40k remaining. I think you'll have to keep that liquid until such times as you have a personal income, as the rent you will no longer be receiving will not be accepted.

JohnDoe1

kingstreet wrote: »

Porting is moving the rate from an old mortgage with a lender to a new one, if you qualify for a new mortgage that is.

The current mortgage is repaid when you sell, a mortgage can't be moved from one property to another.

You will struggle to get a new mortgage if unemployed and a BTL mortgage for a property you intend to live in is no longer acceptable, so I trust you plan to pay cash for your new residence.

You say you'll sell for £350k, so when your mortgage is repaid, you'll have £260k left. If you buy for £220k for cash, you'll have £40k remaining. I think you'll have to keep that liquid until such times as you have a personal income, as the rent you will no longer be receiving will not be accepted.

Thanks.

Not sure if you are misunderstanding me or I'm misunderstandng you.

So the idea is to port the mortgage which, as you explain in effect is, redeeming the current mortgage on the £350k property, and selling it, and applying for a new BTL mortgage on different a different property worth around £200k using existing rate/terms of the previous mortgage. The LTV is still under 50% so that's OK.The rental income of the new property should be over 150% so that's OK.

So the only issue is no earned income.

The reason I'm trying to do this is to avoid the early repayment charge.

kingstreet

I don't believe you'll get a new mortgage from your current lender.