BTL mortgage into retirement

Hilou

We have paid off our own mortgage and are thinking of applying for a mortgage on a new property for a close relative who would be our only tenant. We would sink a chunk of our savings into the deposit. Our house is worth over £600k and the proposed purchase under £200k. Our income is over £100k p/a and outgoings consist of energy bills and upkeep on our home. No other debts. ; but we are nearing retirement age. Though in 10 years or so we will be due a lump sum, pensions and various legacies from our elderly parents.

What do we need to think of? The relative has no dependents or spouse. Should we hold back on the deposit to cover the payments into retirement or just go all out to pay it off asap?!

Thanks for any advice.

glosoli

It will be a regulated agreement as your relative will be residing in the property. This means that affordability will have to be demonstrated, going into retirement. What will your regular incomes be when you retire, will it be sufficient for the mortgage to be affordable?