could we possibly switch the mortgage to a buy to let.

acarr_2

Hi I'm hoping someone can advice.
We were in the process of selling our flat and buying a new house, however the flat sale has fallen through. We are desperate not to loose our dream house so my question is would it be possible to switch the mortgage on the flat to a buy to let and then rent that out and continue to buy the house.
The flat is worth £210,000, it has £99,000 left on the mortgage and would rent out for approximately 750-800pm.
The property we are buying is for £346,000 with a current mortgage agreed for £259,000. We have joint incomes of approximately 75,000. No dependents and minimal outstanding debts!
Many thanks

kingstreet

What is the source of the deposit for the onward purchase?

acarr_2

I think I mean a let to buy mortgage so using the equitee in the flat to cover the deposit?

libf

acarr wrote: »

I think I mean a let to buy mortgage so using the equitee in the flat to cover the deposit?

So you'd be looking to increase your mortgage on the flat at the same time as converting it to a buy-to-let, and then using the released equity as the deposit on the new house?

kingstreet

Right.

You could remortgage the flat upto 75%. This would be subject to the rent being sufficient for the mortgage amount. £800 pm would cover a mortgage of £139,600, so this doesn't look great, I'm afraid.

£139,000 - £99,000 = £40k towards next purchase, so you'll be looking for a near 90% mortgage on the purchase.

It is possible, so by all means speak to an independent broker but you'll have to re-start your purchase mortgage again as it's unlikely you've applied to a lender happy with a let to buy in the background at 90%.

acarr_2

Thanks I will try speak to a broker!

Simon11

acarr wrote: »

Hi I'm hoping someone can advice.
We were in the process of selling our flat and buying a new house, however the flat sale has fallen through. We are desperate not to loose our dream house so my question is would it be possible to switch the mortgage on the flat to a buy to let and then rent that out and continue to buy the house.
The flat is worth £210,000, it has £99,000 left on the mortgage and would rent out for approximately 750-800pm.
The property we are buying is for £346,000 with a current mortgage agreed for £259,000. We have joint incomes of approximately 75,000. No dependents and minimal outstanding debts!
Many thanks

It doesn't look a great investment as BTL. I have a property worth £130k and I get £850 per month but this does include service charge £1k & agency fees 7%.