Second home mortgage

Homeseeker

I have property worth 385K and outstanding mortgage is 275K, currently fixed till Sept 2021. This property can easily rent out so we want to let this property out an buy a second home to live. I know that the mortgage on the first property will need to change to a buy to let.
1. What are my borrowing and mortgage options for a second property?
2. Is there any leverage from the first property?
3. How much can I get for a second mortgage considering a 50 to 60 k deposit for the second property?
4. Any suggestions on how to proceed and which advisors to contact?

sst1234

If you are fixed until sept 2021, there will be a fee to pay to exit the mortgage and turn it to buy to let. Alternatively, you can try and get consent to let from your lender. You can borrow more against the first property but it will be a separate mortgage since your fixed right now and it will cost more than your current rate of interest, and if you go above 85% LTV, you may not be able to get a BTL mortgage later as lenders have stricter criteria for this. 

No one here can possibly tell you how much mortgage you can get for the second property without knowing your income and monthly expenditure. How much do you earn, what are your outgoings? How much is the property you want to buy and over what term? Do you have the extra for additional SDLT or that is coming from that £50-£60k deposit figure? 
What are your monthly repayments on the current mortgage, how much do you expect to get in rent? Are you a higher rate taxpayer? How much do you plan to ring fence for expenses and repairs? 

Lost on here will advise you against being a landlord just because you sound like a beginner. For what it’s worth, everyone has to start somewhere so not being an expert doesn’t mean you shouldn’t do it. But there’s way too little information here to give decent advice. 

AdrianC

Have you done the sums to see if this residential lettings business is even going to be profitable?

K_S

@Homeseeker
1. It isn't possible to say with the limited info in your post.

2. Depending on the estimated rent, you *might* be able to potentially release up to 75% LTV on a BTL mortgage, so around another 13k or so. But the rent needs to support that level of borrowing or you need to consider lenders who may consider personal income (called top-slicing) to some extent. Your choice of lenders will be slightly limited by way of being a first time landlord and you having lived in the property (making it a regulated BTL, at least this time around)

3. Need a bit more info to give a guesstimate. Generally speaking, your max borrowing will be a function of your income, debt and outgoings limited by a loan-to-income multiple, usually 4.5-5x depending on the lender/product.

4. I would recommend getting in touch with a broker to get a realistic idea of your options.