What counts as income?

Whichhome

My income would hardly amount to much for a new mortgage. However can I include Child Tax Credits?

I would also like to rent out current home I own outright so could I include rental income from my current property to give an overall income to calculate a better amount that would be required to purchase.

I have thought of Let to buy with smaller purchase mortgage as an option also but looking at the rates I would be paying double interest compared to standard purchase mortgage alone.

betmunch

Some lenders will include your CTC, but the potential rental income wouldn't be considered without a track record.

Whichhome

Thanks Betmunch

So I would therefore need a let to buy and purchase mortgage which I would have liked to have avoided re high interest rates.

that leads to the next question of do I go for higher mortgage on Let to Buy or the purchase mortgage?

betmunch

No where near enough info to make a suggestion.


You should go and see a local broker who will analyse your whole situation and advise you on the best way to go forward.


Good luck

Whichhome

I saw one in estate agents who suggested 150k (75%) on let to buy and up to 130 new purchase mortgage. I think it was L&C? I am looking for 200K mortgage and have 10% deposit.

I was thinking of going to an Ind Mortgage advisor. The fee is a few hundred but not sure if this only applies if I then take the mortgage or from the start?

betmunch

The first document you will go through together is the IDD which will explain what the fees are and when they are due.


If you don't like them then don't use that particular broker

Thrugelmir

If you've a mortgage on the property you intend to let then the income will be disregarded. Not least that you may no income from the let property or may incur unexpected high outgoings.

lonestarfan

Thrugelmir wrote: »

If you've a mortgage on the property you intend to let then the income will be disregarded. Not least that you may no income from the let property or may incur unexpected high outgoings.

The op says in the first post the house is owned outright so I take that to mean it has no mortgage on it.
Can you reword the bit "Not least that you may etc " as I don't understand the point you are trying to make. Cheers.

Whichhome

If I get 150k repayment mortgage on the Let to buy, what I earn in income will subtract the mortgage amount every month from before I pay tax.

Ie 500 rent - 400 mortgage = 100 I pay tax on. is this right?

Is it the interest only or both capital and interest I get the relief on?
If I get garden done after mortgage goes through and shed for garden will I then count this as expenses? Want to get wall fixed for health and safety for tenant And will be a costly outgoing. is their a limit on outgoings for the property?

Claree__x

Whichhome wrote: »

If I get 150k repayment mortgage on the Let to buy, what I earn in income will subtract the mortgage amount every month from before I pay tax.

Ie 500 rent - 400 mortgage = 100 I pay tax on. is this right?

Is it the interest only or both capital and interest I get the relief on?
If I get garden done after mortgage goes through and shed for garden will I then count this as expenses? Want to get wall fixed for health and safety for tenant And will be a costly outgoing. is their a limit on outgoings for the property?

It's interest only you get tax relief on.

If you're renting the property furnished you would claim wear & tear at 10% of the rental income (roughly, there is a wee calculation). If unfurnished you can claim for expenses incurred as long as they're not capital expenses - ie. They improve the property. If they're repairs or renewals that's fine. If they're capital they're dealt with when you come to sell.