Is honesty the best policy?

chrishar

Thanks for the replies.

I need to decide the best course of action to take in order to:

1. make sure I have permission to let my first property

2. release equity for a deposit for a second property

If I contact the current lender who has already refused consent to let, I can guess they will either want the loan paid back (so I then have to find a new lender) or change my mortgage (not currently in a fixed term) to buy to let and a higher rate. I think the former is more likely as I have a feeling they will only allow buy to let if I already have another residential mortgage, which I don't.

Can anyone confirm this is the right action to take and if I have missed anything, before I make a call? Thanks.

GMS

For a BTL you need to get a broker, preferably one who isn't dodgy!

chrishar

I have thought of the best way to get things in order. I will buy the second property on a residential mortgage with money I have in savings, and also borrowing from a friend. Once complete I will re-mortgage the first property on a buy to let basis, at the same time borrowing more so I can pay my friend back in a few months. That gets around the problem with having to have a residential mortgage before I am allowed a buy to let. It also gets around the problem of having to re-mortgage the first property twice, being tied in and paying redemption fees.

BillJones

chrishar wrote: »

I have thought of the best way to get things in order. I will buy the second property on a residential mortgage with money I have in savings, and also borrowing from a friend. Once complete I will re-mortgage the first property on a buy to let basis, at the same time borrowing more so I can pay my friend back in a few months. That gets around the problem with having to have a residential mortgage before I am allowed a buy to let. It also gets around the problem of having to re-mortgage the first property twice, being tied in and paying redemption fees.

You may struggle to get the new mortgage if you are using additional borrowing from a friend towards it. This will be taken into account in the affordability calculations, so do make sure that you understand that it cannot form part of your deposit.