Buying a second property?

chrishar

I have no other savings, just my current account with 1-2k in it and my mortgage. As I said I can get a personal loan from nationwide for 3.4% if needed, up to 25k.

chrishar

So the overwhelming advice I am being given is 1. Extend the lease NOW, before any other decisions?

hazyjo

In simple terms, I don't understand hanging on to an asset which you maintain, want to make money from, yet are happy for it to be worthless in your later years or when you die. It's like saving thousands only for it to be buried/burnt with you. Surely you'd have chosen to enjoy that money, or leave it as an inheritance to a family member/loved one.


Maybe I'm missing something...


Jx

AdrianC

chrishar wrote: »

I have no other savings, just my current account with 1-2k in it

Sounds to me like you definitely need to rethink priorities.

By increasing your mortgage on the existing short-lease property, you'll be markedly increasing the LTV on a place with a rapidly diminishing value. You will need to find a substantial deposit for your new purchase, as well as funding the lease renewal for your existing purchase.

Meanwhile, you have a wholly insubstantial buffer in case of problems with the existing property. And we're in a period of massive political and economic uncertainty with interest rates that have been ridiculously low for a long enough period that they will come as a real shock when they return to more typical levels.

What scares me even more, on your behalf, is that you aren't even remotely worried by any of this...

Pixie5740

chrishar wrote: »

I have no other savings, just my current account with 1-2k in it and my mortgage. As I said I can get a personal loan from nationwide for 3.4% if needed, up to 25k.

With an income of just £24k to £30k? I'm not saying you can't, I'm just surprised a lender would be willing to give an unsecured loan for almost the same as your gross annual income.

chrishar

Yes 100% I can get the loan, they are always offering me it when I log in to banking. I just need to sign and return the form. That would pay for the lease via a solicitor and then repayments to that loan I could use from the 1k/month owed to me, or from selling the flat with long lease.

AdrianC

chrishar wrote: »

Yes 100% I can get the loan, they are always offering me it when I log in to banking. I just need to sign and return the form.

Riiiiiight.

chrishar

Why would I be worried ? I have over 100k equity in a flat, I have friends who have £50 in the bank and still temping at age 36. And Adrian what is so shocking that I am able to get a loan of 25k?

hazyjo

Hope you're making interest on the £36k if you're then having to borrow money which you'll be paying interest on. Just kind of makes zero sense to me, but hey ho. Each to their own logic


I lost a friend once when I wouldn't take out a £7k loan for him! £36k?! That's an awful lot of risk :eek:


Jx

AdrianC

chrishar wrote: »

I have over 100k equity in a flat

But that doesn't help you one bit when you have to spend on legal costs to evict a tenant who's not being paying his rent, leaving you with a trashed flat.

And Adrian what is so shocking that I am able to get a loan of 25k?

That you believe a generic banner advert is targetted to your precise circumstances, and that you will get the equivalent of your annual salary at a low rate. Combine that with your massive debt from "friends", and you appear very financially naive.