Capital Raising Mortgage?

RedHitman

Hi everyone... :beer:

Hoping someone can help and point me in the right direction.

I own three properties, mortgage free. Two are residential properties (my own, and my parents) and the third is a house I let out. I want to buy another house to let but don't have the full funds to purchase it outright and thus need about 60k to do so. I don't want a buy-to-let mortgage (mainly because I don't think I'd meet some of the criteria some lenders require) and so my plan is to "remortgage" my existing home for the sum (which I've since come to learn is actually a Capital Raising Mortgage).... But I can't find anywhere that does them for this purpose (using your own assets as collateral).

I do all my banking with Nationwide; they actually do Capital Raising Mortgages but they won't do it if the money being released is for a property purchase which will generate an income (letting, basically).... So the only way around this conundrum is to lie to them and say the money is for something else, which I of course don't want to do.

Can anyone help me here?

kingstreet

Use a lender you don't need to lie to?

Nationwide is one of very few lenders to have an issue with such borrowing.

BTW I'd call it a remortgage of an unencumbered property. This is important as some lenders won't give you the free valuation/free legals they do when there's a mortgage being refinanced.

Lilla_D

I agree, most lenders are perfectly fine with your proposed solution.

However, as all lenders have their quirks, it's easiest if you speak to a broker before you waste time with another lender only to find that they don't like another aspect (e.g. the subject property you're trying to remortgage) and then another lender would want you to find the new property before you apply (while others are not as bothered), etc.