Complicated

Ottosump_2

Hello group, I am currently looking at purchasing a rundown property for £165,000 with the intention of using it as our family home. I currently own my own house worth about £110,000 with £7,000 outstanding on the mortgage and I own my mothers home worth about £100,000 with about £9,000 outstanding on the mortgage. The obvious choice is to sell my home and request an additional mortgage to cover the shortfall & about £35,000 needed to make the new property habitable, but I really don't want an additional mortgage, so is there some way I can use my mothers home to raise further funding, (without kicking her out on the street).
All advice would really be apprecaited.
Regards
Otto

lynnexxxo

Hi there

If you sell your house you'll have say 100k equity and you still need another 65K + 35K for your new property. So unless you also sell your mums house you need to raise 100K by mortgage.

I would reckon (and I'll stand corrected if wrong) that a mortgage on your new property would be cheaper than remortgaging your mums house - as its not your main residence you'd have to get a BTL mortgage.

One solution would be to move your mum in with you to your new property and sell her house - you'd almost be mortgage free!

Ottosump_2

lynnexxxo wrote: »

Hi there

If you sell your house you'll have say 100k equity and you still need another 65K + 35K for your new property. So unless you also sell your mums house you need to raise 100K by mortgage.

I would reckon (and I'll stand corrected if wrong) that a mortgage on your new property would be cheaper than remortgaging your mums house - as its not your main residence you'd have to get a BTL mortgage.

One solution would be to move your mum in with you to your new property and sell her house - you'd almost be mortgage free!

Move my Mam in with me, you obviously haven't met my Mother Lynne, only joking. The new property is only 3 bedrooms, and my 2 youngest children will be coming along. I was kind of hoping for some type of equity release answer on my Mothers dwelling. But I suppose your right, a new mortgage would probably be best, and less complicated. Thanks for taking the time Lynne, much obliged.

PS: Still open to further advice..........

MortgagesInc

It depends on income etc, but a lot of lenders will happily lend to you on their normal mainstream rates as the home is for a 'dependant relative' - so the rates would be similar to any new mortgage anyway. The thing is, even if you raised some on her house you would still need a mortgage, albeit smaller, on your new home, so in effect you might end up paying set up fees twice.