We’d like to remind Forumites to please avoid political debate on the Forum.
This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
PLEASE READ BEFORE POSTING: Hello Forumites! In order to help keep the Forum a useful, safe and friendly place for our users, discussions around non-MoneySaving matters are not permitted per the Forum rules. While we understand that mentioning house prices may sometimes be relevant to a user's specific MoneySaving situation, we ask that you please avoid veering into broad, general debates about the market, the economy and politics, as these can unfortunately lead to abusive or hateful behaviour. Threads that are found to have derailed into wider discussions may be removed. Users who repeatedly disregard this may have their Forum account banned. Please also avoid posting personally identifiable information, including links to your own online property listing which may reveal your address. Thank you for your understanding.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
2nd home not sure what to do
satmanuk44
Posts: 32 Forumite
Hi
Looking for some advice on what to do about getting a 2nd home. I've seen people talking about buy to get via LTD but not sure if this is a path I should take.
In a nut shell I need a bigger house for the family and selling my current home seems a waste as if I was to remortgage the rental income would see me around £150 in profit each month.
My current plan was to get my partner to get a mortgage on our existing home and then I would get a mortgage on the second home. We would avoid the 2nd home stamp duty as we would own the houses as individuals and not jointly.
We would then use all rental income to pay off the old house, so overpaying circa £150 a month.
Would putting in into a LTD be any benefit? The only benefit I can see so far is that we could get a bigger 2nd home as both our incomes would be counted, although we would then have a 2nd home stamp duty bill.
Current home value £105,000 equity £25k.
On my own I could get a mortgage for £195,000
Together we could get one for £295,000
Thanks!
Looking for some advice on what to do about getting a 2nd home. I've seen people talking about buy to get via LTD but not sure if this is a path I should take.
In a nut shell I need a bigger house for the family and selling my current home seems a waste as if I was to remortgage the rental income would see me around £150 in profit each month.
My current plan was to get my partner to get a mortgage on our existing home and then I would get a mortgage on the second home. We would avoid the 2nd home stamp duty as we would own the houses as individuals and not jointly.
We would then use all rental income to pay off the old house, so overpaying circa £150 a month.
Would putting in into a LTD be any benefit? The only benefit I can see so far is that we could get a bigger 2nd home as both our incomes would be counted, although we would then have a 2nd home stamp duty bill.
Current home value £105,000 equity £25k.
On my own I could get a mortgage for £195,000
Together we could get one for £295,000
Thanks!
0
Comments
-
satmanuk44 wrote: »
In a nut shell I need a bigger house for the family and selling my current home seems a waste as if I was to remortgage the rental income would see me around £150 in profit each month.
No it wouldn't. And i'll put my mortgage on it.
Dear me...0 -
This isn't going to be a go-er I'm afraid. You'll need to sell the first one to buy the next one.0
-
What expenses have you allowed for when calculating your £150 pcm profit figure?It may sometimes seem like I can't spell, I can, I just can't type0
-
and based on what income? 12 months rent coming in without fail year in year out?
Base you income budget on 10 months pa and then calculate the costs.0 -
Put your mortgage on what?0
-
My workings out are based on:
Current rented properties on my street circa £650 a month.
£80K BTL mortgage 4.74 APR = £417PCM
My brother is gas certified and a plumber while I do roofing. I will not be using a letting agent and have the time to manage 1 house. House has recently had new fitted kitchen, bathroom and re-plastered. Oh and the boiler is 18 months old.
As for the £150 it doesn't matter to me if its £0 as long as the mortgage is paid that the only goal as its a long term investment.
Please can someone give me some reasons instead of throwing in their 2p's........0 -
-
You won't avoid the second home stamp duty. Partners are considered as a joint unit so you will between the two of you own two house so 3% stamp duty will be due on the second one. Your plan to get round the stamp duty will only work if you live in one of the houses and your partner lives in the other one.
The money that you own in the first house is 25k the rest belongs to the bank. You owe £80k. Buy to let mortgage companies typically want you to have £25% equity so that fails straight away. However the big problem is where are you going to get the deposit for the next house from? You can't use the same £25k equity for both houses.0 -
Need to look into your first point, as for owing £80k I have savings to cover getting me to the 75% and savings for deposit on new house. I dont' need to use equity in current house.0
-
satmanuk44 wrote: »Need to look into your first point, as for owing £80k I have savings to cover getting me to the 75% and savings for deposit on new house. I dont' need to use equity in current house.
Right so you have enough for the buy to let mortgage so how much mortgage would you need then on the first house to run it as a buy to let because you haven't said that you would pay this mortgage off you said that you could get to the £75% deposit required for the mortgage but you would still have a mortgage?
For the new house you would be able to borrow how much when you had used more of your saving for a deposit? Would that buy a you a bigger house and pay the extra 3% stamp duty?0
This discussion has been closed.
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 352.1K Banking & Borrowing
- 253.5K Reduce Debt & Boost Income
- 454.2K Spending & Discounts
- 245.1K Work, Benefits & Business
- 600.7K Mortgages, Homes & Bills
- 177.5K Life & Family
- 258.9K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.2K Discuss & Feedback
- 37.6K Read-Only Boards