Will owning other houses outright affect my future mortgage application?

JonMitchell

Hi

I have a mortgage under my current house and owns another property outright at the moment.

Will having my name on a second title deed affect my re-mortgage application in future? Therefore will it be more a burden for future re-mortgaging application? E.g. mortgage lender factor in other issues?

Thanks

Thrugelmir

Another financial commitment will influence the outcome.

JonMitchell

Thanks Thrugelmir! I presume the influence will be more negative than positive? My current second property is on a rental basis, so financial wise, the rental covers everything, with no further commitment from myself.

Thrugelmir

Unless unencumbered, i.e. mortgage free. Lenders will take the pessimistic view. If the property is empty or the tenants fail to pay you. Then the property is a negative drain on your cash flow. Evicting unwilling tenants can be a financially draining experience.

JonMitchell

The second property is mortgage free. In this case, how will mortgage lender view it then? Will it still be pessimistic for my future remortgage of my current property.

kingstreet

If you have an unencumbered let property, it is possible the rental income can be included to help affordability for your residential.

If the property was mortgaged, you would hope to satisfy lender criteria for it to be self-financing and ignored resulting in no impact on your residential.

JonMitchell

Thanks Kingstreet, I will bare that in mind. greatly appreciated.