New Mortgage Help

RyanWZRD

Hi all,

Hope you’re all safe and well,

I have recently accepted an offer on my house for £320,000 and had an offer accepted on a new house for £240,000.

Currently due to financial commitments, I can borrow around £70k due to having a loan, and credit card debt that has been used for wedding, house renovations and having a baby. This debt in total equates to £37k. If I did not have this debt, I can borrow £173k which would comfortably get me into the new house, and leave some cash for renovations.

I intend to pay off the debts from the equity of my house on completion and move into the new house on the same day. Is this possible?

How do I reassure my mortgage provider that I will pay off these debts on completion so they can lend me the £170k and I put down £70k to purchase the house for £240k? Would I also still need a DIP or would I be transferring my mortgage from one property to another? I am aware of however that my LTV will be different therefore, the amount I pay each month should realistically change, but I am currently in a 5 year fixed rate? Would my old mortgage close and apply for a new one? Or would they make it on the offer of the mortgage that they will lend me £170k on the basis that the debts are paid off. But how do they manage that after I will be paying off the debts AFTER they have lent me the £170k?

The decision behind selling my house is to pay off the debts, but also to move into a more rural setting. 

Hope that makes sense, thank you in advance! 

Ryan