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Help - Mortgage advice please
steveinhants
Posts: 40 Forumite
Hi.
I recently saw a mortgage advisor and I'm more confused than ever.
Background
1. Current residential mortgage (joint): £165,000 mortgage. Value of property
£500,000.
2. Aim is to withdraw an extra £200k and swap above mortgage to
BTL. So BTL on interest only for £365,000 against a value of
£500,000
Expected rental is £1300 PCM and based on a quick search
monthly repayments are £752, fixed for 5 yrs. I make that
172% of mortgage.
3. Further residential mortgage required for £350,000 against a
value of £550,000. Again a quick search shows initial payments of £1705 for
5 years fixed.
So, the advisor ran some software and these figures and told me we could only raise the current mortgage to £200,000 - an increase of £40,000. I'm pretty gobsmacked to say the least and I simply can't get my head around this at all.
Joint income is around £110,000 per year.
Can anyone shed some light on this please?
Steve
I recently saw a mortgage advisor and I'm more confused than ever.
Background
1. Current residential mortgage (joint): £165,000 mortgage. Value of property
£500,000.
2. Aim is to withdraw an extra £200k and swap above mortgage to
BTL. So BTL on interest only for £365,000 against a value of
£500,000
Expected rental is £1300 PCM and based on a quick search
monthly repayments are £752, fixed for 5 yrs. I make that
172% of mortgage.
3. Further residential mortgage required for £350,000 against a
value of £550,000. Again a quick search shows initial payments of £1705 for
5 years fixed.
So, the advisor ran some software and these figures and told me we could only raise the current mortgage to £200,000 - an increase of £40,000. I'm pretty gobsmacked to say the least and I simply can't get my head around this at all.
Joint income is around £110,000 per year.
Can anyone shed some light on this please?
Steve
0
Comments
-
The new PRA rules have left lenders needing rent to be in the region of 145% of mortgage interest assuming a rate of perhaps 5.5%pa.
Your estimated rental income is woefully short.
You would need a lender willing to take personal income into account in establishing overall affordability.I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0
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