Remortgaging Dilemma...

nmyers89

Hey!

In desperate need of advice. I'm 24 and two years ago I purchased my first home. I managed to get the house for a lot cheaper than the asking price (they needed a quick sale) at £119,000 and the mortgage value was £89,000.

I'm now approaching the end of my two year fixed offset deal and because my property is now valued at £14k more than what I paid, my LTV will be 65%. This means that when I look to remortgage with another provider I stand to make a saving of around £100 a month, so I can save more and pay off faster.

The dilemma quite simply is this...I've been doing some research and I've been considering the idea of releasing equity in my property (so to speak) to invest in another. I'm toying with the idea of remortgaging, borrowing more, thus making the LTV on my current more like 75/80% and using this money as a deposit on a cheap buy to let. [BTW my salary means I can technically borrow up to around £135,000]

I guess my questions are as follows... is the above possible and how would I go about doing it? Which do you recommended - stick to one and pay it off fast, or get another? I want to invest in my future but I want to be sensible and properly consider all avenues and options. Any tips, advice, help or guidance over the next week or so would be very welcome!

Thanks so much you guys! x

Thrugelmir

You may encounter two issues.

Lenders may be reluctant to release equity for the purpose of a deposit on another property.

The BTL lender may well decline your application on the source of the deposit.

Leveraging is a dangerous game when all the talk is of interest rates rising and finally starting to return to normal.

safestored4

Also bear in mind that at some point one or more of the political parties are going to realise that there are a lot more votes to be had from frustrated would be first time buyers and their parents than from amateur buy to let landlords. When this happens expect measures such as the disappearance of tax relief on mortgage interest payments for residential property that buy to letters presently benefit from. And that's only for a start if Ed Millibands proposals last week are anything to go by.