Let To Buy Mortgages

K1RST1E_2

Hi,

My husband and I bought my sister in law out of our inherited home back in 2014. We've invested a bit of money in the house and have £50,000 equity in the home.

It's a lovely home with sentimental value but it's not big enough for us. There have been a lot of new developments in our area and one in-between our place of work and the children's school. They are a great size but a hefty price.

We have good jobs and can get a mortgage to cover the costs but are pondering the idea of not selling our current home and getting a let to buy mortgage.

Has anyone any experience of this?

From what I've read we'd need to have 25% equity in our current home that we intend to let (this is fine). We'd need to release the remaining equity to fund the deposit on the new house (it would equate to 10% leaving 25% in the house we intend to let).

The other option would be to release some equity in our current home to get the extra space we need.

Thanks.

brit1234

Your have to pay an additional 3% stamp duty if you keep your existing home and buy another. Is there anyway to extend it to create more room?

K1RST1E_2

Thank you, Brit. I didn't know that. The finances would be mega tight and at the moment, we're super comfortable

Without compromising the garden space, which isn't very big, extending out the back isn't viable. We could extend at the side as what we need is a utility room and a downstairs toilet. A conservatory would be a bonus as a playroom for the kids.

I guess I need to see an architect to come up with ideas.

AnotherJoe

Can you explain why you are looking to rent out your existing house (should you move)?

What's the thinking there ? Do you have ambitions to be a landlord ?

K1RST1E_2

Hi Joe,

Only to get more space. We wouldn't want to sell this house initially as it was my husbands family home so has a lot of attachment to it.

He would like to go into property development but I guess that's more of a pipe dream!

This house is fine for us with a bit more investment but we're limited on extending due to the small garden at the back. We're considering a loft extension in the future but we could do with more space downstairs sooner rather than later. And a downstairs toilet would be ace with two young children!

AnotherJoe

K1RST1E wrote: »

We wouldn't want to sell this house initially as it was my husbands family home so has a lot of attachment to it.

That's going to be a very expensive piece of sentimentality to pay for.
How much attachment will he have once a variety of strangers have lived in it for years ? And rather than pleasant memories when it's a source of hassle due to tax, tenants issues, costly maintenance. ?
Owning one house is stressful and costly enough, unless you wish to make a business out of this, in which case sentimentality goes out the window, it makes no sense to hang on to childhood dreams. Concentrate on creating better memories for his kids instead