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Buy To Let
Brostie
Posts: 11
Forumite
I'm selling my house in order to buy a slightly larger one. I own this house outright and the new house is just 10k more which I have in cash. However woudl it be possible to apply for a buy to let mortgage on this house so effectively buy it from myself. then rent it out and use the rent to pay the mortgage?
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Comments
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Yes. You won’t be buying it for yourself though. Getting a mortgage is just a loan secured on a property.0
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Yes.
That's the short answer.
Longer answer is BTL (or LTB in your case, but the same thing really) mortgages generally lend upto around 75% of the property value and also restricted by the rental income. So you may find you need to take one mortgage on the property you are leaving and a residential mortgage on the property you are buying. You could well find that the better mortgage deals are available on residential mortgages, so consider borrowing more on that one. The interest on the mortgage is an allowable expense wherever it is secured, so don't worry about that. Be aware that restrictions on the interest to be treated as an expense mean that having high mortgage payments may mean you make a loss.
More explanation of that here. It will hit higher rate tax payers.I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0 -
You'll also need to pay the extra 3% SDLT.0
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