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Multiple Mortgages
Aurora_Mirror
Posts: 3 Newbie
Say I have a small residential interest-only mortgage on a flat with Bank A, then take out a new large repayment residential mortgage on a house with Bank B. My plan is to live in the house and rent out the flat.
My question is- how would Bank B factor in my interest only mortgage into its calculations of how much it would lend me for my house?
My working assumption would be that they would be okay with it because both banks have security on their loans, because there are two properties. However, I imagine Bank B would want to count the interest payments on the flat as an expense.
What I am trying to do is hold onto my current flat by moving its mortgage over to a residential interest only or a buy to let interest only mortgage (I am unsure which is better). This means in theory I do not have to sell it (the London market being poor) and can still get a conventional repayment mortgage on the house.
Aurora
My question is- how would Bank B factor in my interest only mortgage into its calculations of how much it would lend me for my house?
My working assumption would be that they would be okay with it because both banks have security on their loans, because there are two properties. However, I imagine Bank B would want to count the interest payments on the flat as an expense.
What I am trying to do is hold onto my current flat by moving its mortgage over to a residential interest only or a buy to let interest only mortgage (I am unsure which is better). This means in theory I do not have to sell it (the London market being poor) and can still get a conventional repayment mortgage on the house.
Aurora
0
Comments
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Maybe I’m missing something but your scenario seems to be a fairly straightforward let-to-buy case which most brokers deal with on a regular basis. Not unusual at all.Aurora_Mirror wrote: »Say I have a small residential interest-only mortgage on a flat with Bank A, then take out a new large repayment residential mortgage on a house with Bank B. My plan is to live in the house and rent out the flat.
My question is- how would Bank B factor in my interest only mortgage into its calculations of how much it would lend me for my house?
My working assumption would be that they would be okay with it because both banks have security on their loans, because there are two properties. However, I imagine Bank B would want to count the interest payments on the flat as an expense.
What I am trying to do is hold onto my current flat by moving its mortgage over to a residential interest only or a buy to let interest only mortgage (I am unsure which is better). This means in theory I do not have to sell it (the London market being poor) and can still get a conventional repayment mortgage on the house.
Aurora0
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