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Tropically

TL;DR: I am considering moving to a place with a higher salary and higher cost of living, however we would personally experience a lower cost of living for as long as my partner can live with the in-laws. We own a property here which would not make much if let out. What would it be like to remortgage from abroad?

I bought a house two years ago with my partner in London, and I am interviewing for a job in a low-tax jurisdiction where I would move with my partner (and in with some of my family at their super strong request). We would live with some of my family as long as we could which would be until my partner goes bonkers.

We are due to remortgage in July, but I wouldn’t move abroad until December 2018 or later, and I’ve only got an interview so this is hardly set in stone. We have been overpaying as part of a general savings strategy but we are holding off any more repayments until we decide what we will do when we will remortgage. When it comes time to remortgage we will owe about £290,000. Assuming no growth price since last July, our house would be worth £425,000 (68% LTV). Assuming 2% growth each year for two years, and our house would be worth £442,170 just over 65% LTV.

We would like to let out our house, but this would probably not be super profitable given that we would need a full service estate agent. Our current repayment mortgage payment is £1250 and we could probably rent the house at £1500, or £1600 if we were lucky.

I was thinking that we could re-mortgage as a 5-year fix residential mortgage, who we would have to ask for permission to let out. We could chose a lender who would be amenable to this. We might put some cash to get below 65% LTV if that would give us a lower interest rate. If we did this, we would have to pay £199 admin fee plus £100 per year consent to let fee, plus say 1.75% interest rate. This is our current interest rate which was on a 2 year fix.

In the future, we’d have a better LTV but interest rates are generally higher than 2 years ago so I have assumed that things will balance out. We would live in the property for about 6 months more before request consent to let.

Question 1: What are my other options and what are the potential problems from doing this 5-year fix? Would it be better to go to the SVR for 6 months and then get a BTL mortgage? I don’t think that anyone would give me a BTL given that there is not a big margin between the mortgage payment and the rent. At most, we could pump £10,000 of savings into the mortgage balance if it would assist, but we would still be borrowing £280,000.

If I were to take this job, I would get a 70% pay rise in addition to having no bills to pay except for petrol. My partner would need to get a job as well, but he would be looked upon favourably due to his immigration status as being married to me. The only way that it makes sense to move is if we live with my family because although the salaries are higher, the cost of living is also higher. But living with your in-laws, even as nice as they are (so I claim!) will get tiring. I imagine we will need to move out in 6 months or 12 months after moving abroad to get our own place.

Question 2: How do I remortgage from abroad? I know my options will be more limited as I will have to get an expat mortgage. Will it be basically impossible to remortgage from abroad in my circumstances? What kind of interest rate premium would I be likely to expect?

Question 3: What will happen if I also buy a small house abroad? If I have a loan there and a loan here will mortgage lenders avoid me? What would a sensible total mortgage to total salary rate be? Would it be 4x combined salary?

If it helps these are the numbers again:

Current Life
Mortgage on London property in July: £290,000
Interest Rate: 1.75%
Monthly mortgage repayments: £1,280
Current take home: £2,100 + £2,700

Future Life (Slightly optimistic but not unrealistic)
Mortgage on London Property in July: as low as £280,000
Interest Rate on London Property: Unknown!
Realistic Take Home Pay: £3,600 (guaranteed if we move – otherwise we’d stay here) + £4,060 (he’d need to get this kind of job)
Assuming could save 80% of our salary due to low living expenses, we'd save £6,128 per month.

silvercar

A remortgage would be much easier here than abroad. I would go for a long fix before you go.

Your future plans have a lot of ifs and buts. Getting the right job that pays well, adjusting to life overseas, living with family, coping with in-laws....not something I would recommend.

Tropically

No taste for adventure, silvercar? I think a 5 year fix is as long as I'm willing to go to avoid any EPC or life changes.

Sorry for the silly title - didn't catch the character limit when I was typing.