Help to purchase

emran2486

Hi

I am looking to purchase a second property, as my family is growing. Current mortgage is with halifax and have myself and my brother on the mortgage.

Dont have much saving at the moment, what are my option and how do i go about remortgaging to release some money from the current property.

Thrugelmir

With little savings. Why not sell your existing property. Rather than buy a second. Which initself will incur you additional costs.

emran2486

Hi, I was planning to sell but looking to rent the place out.
So what I am thinking is change my current property to buy to let and buy the second as residential.

my current property the mortgage amount left is 72k, and valued at 300k.

KnowledgeIsLife

I would first check with your current lender if you can convert your residential mortgage to a buy to let or get consent to let (depends on lender) as without this you would be stuffed. Also take into account affordability yes there would be rental income but if the property is vacant you have to make the mortgage payments and any other associatied bills they will take all this into account some lenders don't let you do additional borrowing when your letting the property check this also as this would need to complete and you would likely have to wait 6-12months before getting permission to let the property out after this I would try saving as much as possible as opposed to borrowing on your existing mortgage your brother also needs to consent to getting into more debt with your additional borrowing.

Thrugelmir

emran2486 wrote: »

Hi, I was planning to sell but looking to rent the place out.
So what I am thinking is change my current property to buy to let and buy the second as residential.

my current property the mortgage amount left is 72k, and valued at 300k.

What is your plan for property no 2 then. How much deposit are you able to put down and how much is the guide purchase price.

emran2486

property number 2 will be for family to move into and live, (being an asian is hard to move out on my own, have to take the family with me. and yes I have tried lol)

thinking of remortgaging/get equity from current home and put that down as deposit.

Good plan or not?

dimbo61

Not something you can do on your own.
Yes there is equity in your current home BUT you need a good mortgage broker to look at the whole picture.
Your Income, age, job, dependants, savings and credit history/score.
What you paid for the property and how much it would rent for.
The list goes on and on.
You might need an accountant who knows about rentals and recent tax changes for Landlords (S24)

Thrugelmir

emran2486 wrote: »

property number 2 will be for family to move into and live, (being an asian is hard to move out on my own, have to take the family with me. and yes I have tried lol)

thinking of remortgaging/get equity from current home and put that down as deposit.

Good plan or not?

Whole multiude of factors at play. As in essence you are leveraging up to buy property no 2 with 100% of debt. One for a broker as there's no straight answer.

You will also incur second home stamp duty. If you are buying a more expensive property than your existing one. Then this is going to be costly.

Likewise I would recommend caution when letting. While it can be extremely profitable. It can also be a total nightmare. Far from a guaranteed route to riches. Crunch the numbers fully. Making due allowance for void periods, maintenance and tax. Will the property generate sufficient net income to repay the capital owed on the mortgage?