2 people buying 1 house who already own there own houses.

EZ_Tutty

Hi,

Me and my Girlfriend are looking at buying a house together, our budget is around £200-225k, we have seen a place we both like, but given we have made no steps to actually sell either of our own houses we most likely won't get it.

We both currently have our own mortgaged houses.
Mine - House Value £125,000
Mortgage Balance £99,000

Her - House Value £80,000
Mortgage Balance £55,000

In an ideal world we'd like to keep her house on as a rental (has a good potential rental income vs value), but i'm not sure we're in a position to do so financially.

I'm just wondering what are the options in terms of pulling money out of her house (equity) to allow us to top up our deposit, whilst keeping it as a rental, rather than just relying on the sale of my house, or if this is not possible how we could proceed in terms of selling both houses, as i'm guessing this could potentially hold up the chain massively making us undesirable buyers.

As we are both living in our first houses, were not sure about the procedures of selling, buying, or owning a rental property.

Any tips or advise is appreciated,

Paul

richy999

Just a quick observation... your current mortgage commitments will be taken into effect in terms of affordability for the new mortgage and will restrict the the total mortgage you will be offered.

Taking equity out of one of your houses to bump up the deposit probably won't help as it will be accounted for in the affordability calculation.

If you need to sell one or both of your current houses to fund the purchase and have not accepted an offer, any offer you make on the new house will probably not be accepted as you would not be in a position to proceed.

G_M

Put both properties on the market. Whichever one finds a buyer first, sell it.

Stash the money somewhere safe & move into the other property.

Find a buyer for the 2nd property, and find a new property to buy. Normal chain where you simultaneously buy and sell.

Of course, if you can afford to buy the bigger property without selling the 2nd one you own, by all means keep/let it.

Do the maths.

BeansOnToast_2

Do what G_M said. Although you could get lucky like we did last year. We managed to complete the sale of both houses and the purchase of our new one on the same day. The gods were kind to us !!

Fireflyaway

Make some enquiries to ensure you can let out the house. Can you get permission to rent it or can you change mortgage providers and get a buy to let. You might find you can't as there isn't enough equity ( seems there probably is) or you can't rent for enough to cover 125% of the mortgage payments.
As others have said, if you keep 1 mortgage it will limit what you can borrow for your next house.