further advance or drawdown facility required

crisp

Hi,

I have the following:

Property 1
valuation £440k
current borrowings £374k
rental income £26,500


Property 2
valuation £400k
current borrowings £340k
rental income £26,500


I am looking to borrow a futher 5% of the value (£42,000) or use the equity £126,000 as a drawdown facility to purchase further property. will this be possible?

thanks

MortgageMamma

yes, but a lot depends on your circumstances

how much do the properties cost you annually? who are the lenders? are you tied into the deals/? are the properties residential or commercial?

carolt

Aren't you cutting this a bit fine? By the look of it, your rent can only just about cover your interest payments at present - is it really wise in a falling market to want to leverage yourself further into debt? Just small falls in the value of your properties will put you in negative equity- only about 15% - without taking on more debt as well...

Are you sure this is the right time to be buying more properties????