Advice would be appreciated, slightly unusual situation

Salmoseeker

Hello I was hoping to get some thoughts if possible.  I am 60 and my wife is 55, I work part time freelance from home earning 15 - 25k gross/pa. I also have a small pension which gives me 10k net.  We don’t have a mortgage and live in a nice little house worth a around £200000 (rural Scotland).  We would like to move and have found a property which we would want to make an offer on to value of £320000. We have cash disposable of £260000 from savings although to access some I’d need to sacrifice interest. I therefore want to borrow £80000 to make an offer (I need to act quite quickly and don’t envisage selling my house until early summer).  I really I have two questions:
a) does my age preclude me from borrowing (I have no health issues or debt).
b) what would be the best form of borrowing. I thought a best rate mortgage with no early repayment penalty but not quite sure.

I am still researching this myself but researching this myself but really would welcome any feedback from people who have been in a similar situation themselves or who just have more experience. Thanks, Pete.

K_S

@salmoseeker Based on the limited information in your post, you *should* be able to borrow in th region of 80k over a 9 year term on the stated income. It will depend on whether you can evidence around 20k self-employment income (generally speaking lenders will take the average of the last two years profit as per your tax returns).

Your age may limit the term based on the self-employed income. Up to 70 with most lenders, 75 with a few depending on plausibility of you being able to carry on with the current employment to that age.

Salmoseeker

Thanks K.S. Yes no problem proving income I have 10 years worth of tax returns. However I don’t think I have been absolutely clear this mortgage would only be to cover the period between buying the new house and selling my existing one - that may only be a matter of months. As soon as existing house was sold and funds released I would no longer require borrowed income. Perhaps in my situation a loan would be more appropriate? Thanks again for your input.

K_S

@salmoseeker Apologies, I misunderstood the scenario. If there is some mainstream way to get an unsecured loan of 80k, I'm not aware of it.

What I've seen clients in your situation do is one of the below -

- the overall cheapest option is likely to be a conventional residential mortgage (ideally a no-fee no-ERC one) for the new house and repay when the current house is sold. How viable this is will depend on the numbers as the existing house will impact your affordability. Also if you are looking to move with speed, this may not necessarily be the best option with self-employed income.

- the other option is a chain-break bridge loan which is a form of short term finance (up to 12m usually) to cover such scenarios. It's likely to be overall more expensive than the above option but will be much faster to execute. See here for how it works -

https://crystalbridgingloans.com/loans-by-purpose/chain-break-bridge/

https://togethermoney.com/bridging-loans/chain-break-b/