Buy to Let mortgage on an inherited house that is owned outright

smiler247

Hello there,

I have inherited my late mum's house which is owned outright and I plan to let out.

My husband and I currently live in a property which is worth approximately 140k with a mortgage of 100k. The inherited property is worth approx 100k.

If I wanted to get a BTL mortgage on the inherited property to put towards my husband and I moving to a bigger property, would I need to provide a deposit for the BTL mortgage?

Thank you for your time.

Keekles

You must leave at least 25% of the property value as a deposit on a Buy to Let mortgage (may be some lenders at 80% LTV, but 75% is the most common).

Theoretically you should be able to draw down on the unencumbered property to improve your deposit on a forward residential purchase - if that's your goal.

Thrugelmir

Why not simply sell the inherited property and use the equity. Leveraging against the inherited property achieves nothing of benefit.

smiler247

I don't want to sell it as it was my childhood home.

silvercar

smiler247 wrote: »

I don't want to sell it as it was my childhood home.

Always worrying to read that. Are you prepared for tenants to live in it, as they see fit, as their home?

Thrugelmir

smiler247 wrote: »

I don't want to sell it as it was my childhood home.

There's little room for sentiment when running a business.

beecher2

smiler247 wrote: »

I don't want to sell it as it was my childhood home.

I understand the emotional impact - it was a real wrench for us to sell a house full of childhood memories and surprising to me how much it felt like a bereavement when I shut the door for the last time. However, you will always have those memories and I am thankful we sold, and can imagine from afar a new family living there without having to see it for ourselves.