Looking for My Next Property

Shroomazon

Hi everyone

I can't really find any solid information on the net so I was hoping someone could point me in the right direction here.

In the next year I am looking at my options for selling up. I will be getting married in the new year and I want to sell my flat, which is in my name only, and look at buying a house with my soon-to-be-wife. I purchased the flat, with a 95% mortgage, for £65k and they are currently selling for around £85k. My wife has around £20k saved for a deposit on a house.

What options do I have going forward?

Would it be best for me to just sell the flat outright and use the money gained to put into a combined deposit with my wife and look at buying a house this way?

Or are there options of retaining the flat, but using equity as a deposit? Or other options?

I find some of the terminology a little confusing, so any examples or advice is muchly appreciated.

Thanks!

ACG

You can pull money out of your current property if you plan on letting it out. You would put the property on a Buy to Let (BTL) Mortgage. The term for that is "Let to Buy" (LTB). Be careful with this as you would only be able to go up to around 75% of the property value, so you could not pull all of the equity out of the property and the rent would need to pass a certain calculation - typically 145% of 5% on interest only....dont worry about that bit for now we can help with the sums if it something you plan on doing.

However, if you keep the property, you would have to pay higher rate stamp duty on the new purchase.

Assuming a purchase price of £100k, that would be £3k where as if you sold the current property, that £3k would be £0. The figures get a little more complicated above £125k and I do not have a calculator, but you get an idea that it will cost you a few grand more in fees if you keep the current place.