Can I remortgage to access cash for personal use?

london1990

Hi there,
I have a quick question about remortgaging and whether it can be used to access cash for personal use.
I switched to a two year tracker in October 2019.  The LTV is about 58% and there is about £200K of equity in the property. 
I have some personal savings from inheritance but want to take about £50K out of the property to be able to fund a business venture.
Is this possible at all?  I am aware there may be early repayment charges but wanted to understand whether this is actually possible, particularly in view of the recent switch to a 2 year tracker.  Would the cleanest route be to sell the property, take the cash I need out at that stage and channel the rest into the next home?
London 

LRmortgage

Taking equity from your home and putting it into a business is seen as high risk. Effectively you are putting your home at risk if the business venture fails. 

Most lenders will not lend for this purpose. 

That being said, there are lenders that will allow it, your best bet is to speak with a mortgage broker and get some full advice. 

london1990

LRmortgage said:

Taking equity from your home and putting it into a business is seen as high risk. Effectively you are putting your home at risk if the business venture fails. 

Most lenders will not lend for this purpose. 

That being said, there are lenders that will allow it, your best bet is to speak with a mortgage broker and get some full advice. 

Thanks for this.  What about taking money out to put towards something like a business degree?  Could one use remortgaging for this? 

[Deleted User]

london1990 said:

Thanks for this.  What about taking money out to put towards something like a business degree?  Could one use remortgaging for this? 

The answer to any question about being allowed to remortgage for a particular reason is 'some lenders will and some lenders wont'

Retired_Mortgage_Adviser

london1990 said:

Hi there,
I have a quick question about remortgaging and whether it can be used to access cash for personal use.
I switched to a two year tracker in October 2019.  The LTV is about 58% and there is about £200K of equity in the property. 
I have some personal savings from inheritance but want to take about £50K out of the property to be able to fund a business venture.
Is this possible at all?  I am aware there may be early repayment charges but wanted to understand whether this is actually possible, particularly in view of the recent switch to a 2 year tracker.  Would the cleanest route be to sell the property, take the cash I need out at that stage and channel the rest into the next home?
London 

Yes it may be possible but depends on picking the right lender considering the entirety of your circumstances.

You options may range from a relatively straightforward further advance from your current lender to taking out a second charge mortgage.

In your place I would get in touch with a small mortgage broker or firm to explore what options may be realistically available.

ACG

Some lenders will lend for anything legal. 

There was a person who remortgaged their home to pay for an investment, which failed. The customer successfully (and worryingly) claimed the mortgage broker miss sold the mortgage. So you may find lenders and/or brokers go the n'th degree in backside covering in case your business venture does not pan out, but yes it can be done.

[Deleted User]

Retired_Mortgage_Adviser said:

In your place I would get in touch with a small mortgage broker 

Im worried this is a new selection criteria for brokers as i am over 6ft! 

london1990

Retired_Mortgage_Adviser said:

london1990 said:

Hi there,
I have a quick question about remortgaging and whether it can be used to access cash for personal use.
I switched to a two year tracker in October 2019.  The LTV is about 58% and there is about £200K of equity in the property. 
I have some personal savings from inheritance but want to take about £50K out of the property to be able to fund a business venture.
Is this possible at all?  I am aware there may be early repayment charges but wanted to understand whether this is actually possible, particularly in view of the recent switch to a 2 year tracker.  Would the cleanest route be to sell the property, take the cash I need out at that stage and channel the rest into the next home?
London 

Yes it may be possible but depends on picking the right lender considering the entirety of your circumstances.

You options may range from a relatively straightforward further advance from your current lender to taking out a second charge mortgage.

In your place I would get in touch with a small mortgage broker or firm to explore what options may be realistically available.

Thank you - does the property value have to increased in order to access an advance under a remortgage?

Or is the fact that there is equity in the property enough?