Is BTL possible for me?

bruciebounus

Just testing the water here, trying to see what my options are. If I went ahead with the below I would engage a broker, just want to see if its possible in the first place.

I currently have a mortgage of around £100,000 on a house worth approx £200,000. I am thinking about buying another house to live in and renting out my current house (various reasons at the moment, I know being a landlord is not easy).

What I wanted to know is if I wanted to take out £60,000 out of the equity for a deposit on new house, would that leave me with enough in the first house to allow a BTL mortgage?

If so, how is affordability calculated on a BTL mortgage, does it depend on my income like a standard mortgage, or is it based on projected rental income?

Thanks in advance.

ACG

On a BTL you can go up to 80% but interest rates jump once you go beyond 75% and the number of lenders reduces massively.

If you were to take out £50k from the property then i imagine it would be possible (subject to everything else).

As for assessing affordability...

The property your renting out, the rent would need to be 125% of the monthly mortgage repayments based on an interest rate of 6% on an interest only basis (not a repayment)... as a ballpark calcultion anyway. Some lenders may be more, others may be less.