New mortgage lender wants me to sell my BTL

rentmekid

Hi everyone,

I am looking to purchase a new property to live in, and the lender that I have gone with (BOS) has approved my mortgage on the condition that I sell the BTL that I have with them.

They have also given me a 3 month timescale of completion to do this.

Does anyone have any experience of this or know of any issues in case my property doesn’t sell?

Thank you

marliepanda

rentmekid wrote: »

Hi everyone,

I am looking to purchase a new property to live in, and the lender that I have gone with (BOS) has approved my mortgage on the condition that I sell the BTL that I have with them.

They have also given me a 3 month timescale of completion to do this.

Does anyone have any experience of this or know of any issues in case my property doesn’t sell?

Thank you

If the sale is a condition of your mortgage, and you don't sell, then you don't get a mortgage...

rentmekid

to clarify, they want me to sell within 3 months of after I purchase my new home

hazyjo

That's very tight! Takes 3 months average from offer to completion. What if it takes you several months to find a buyer?!

kingstreet

Are you 100% sure it#s 'sell the property' and not 'repay existing BOS mortgage' as that would sound far more realistic/logical?

ACG

Did someone tick the application form to say that the mortgage on the BTL would have been cleared by completion of this new application?

Did you use a broker or apply directly?
What made you apply to BoS if they want the BTL selling? - Although as Kingstreet says, it seems like an unusual requirement.

dimbo61

Are you on a good rate with BOS on your BTL Mortgage ?
What is the yield ?
Are you taking on more debt ?

G_M

I'm going to assume you don't want to sell the BTL - otherwise why the query?

rentmekid wrote: »

I am looking to purchase a new property to live in, and the lender that I have gone with (BOS) has approved my mortgage on the condition that I sell the BTL that I have with them.

Why would you go with a lender who imposes a condition you are not happy with? Go with a different lender!

rentmekid

Kingstreet - yes you are correct, they want the balance repaid (£120k) - I assumed they wanted me to sell.


G-M - yes, I want to keep this btl


Dimbo61 - the rate is their standard 4.94%, I know its poor, but I don't have enough equity to remortgage

00ec25

rentmekid wrote: »

Kingstreet - yes you are correct, they want the balance repaid (£120k) - I assumed they wanted me to sell.

so the scenario has more possibilities than your thread title suggests. In order to get a BoS residential mortgage on your new home you must a) pass the income/affordability tests for that property and b) still meet the generic income requirement they use for a BTL mortgage. It appears you pass a) but fail b), so they have imposed the condition that the BoS BTL mortgage must be repaid. They have not said the property itself must be sold.

We will take as read that you cannot afford to repay the BoS BTL mortgage otherwise you would have the cash to buy the new home to start with. Therefore, could you:

a) take the BoS residential mortgage as offered and purchase the new home
also
b) re-mortgage the BTL with another lender so that the borrowed funds pay off the BoS BTL mortgage and do so within 3 months of step a)?

Have you checked with BoS whether they would accept your BoS residential mortgage if there was a non BoS BTL mortgage in existence? basically they do not want the risks of having you as a borrower indebted to them for 2 mortgages, but may be if the second mortgage is someone else's risk then BoS will still be happy to let you buy the new home on a resi mortgage. You can but ask...

nyermen

Extra point - (I don't read it above) - If the BTL property has an existing tenant, it will reduce the market to only other BTL-ers, or someone willing to wait for an eviction.