Apply for BTL mortgage as back up plan.

Snookie12cat

I am thinking of back up plans to continue my purchase. The buyer is still hanging on, but things are not progressing fast and there is still no guarantee what time frame they will get things done by and if they will get their mortgage offer 

The plan is to therefore potentially remortgage current house on BTL and rent out. I know it takes about 2 months to set up a BTL mortgage and that timeframe if started in a month will likely have my resi offer expire, not to mention the seller would probably drop out.

Is there anything to stop me starting the application now to remortgage my house on a BTL mortgage and then should a month go by and the buyer doesn't pan out, I am halfway towards the BTL being done. 

If the buyer pans out I will just cancel the application with the BTL lender? Is there some negative I am not seeing? 

eddddy

Are you buying the new place with a mortgage? If so, you'll probably have to tell the lender of your planned change in your financial circumstances (e.g. additional BTL mortgage payments). It might influence how much they are prepared to lend.

I don't know if it's feasible to go forward with 2 concurrent mortgage offers for your new place - one for if you take out a BTL mortgage as well, and one for if you don't take out a BTL mortgage.

Snookie12cat

eddddy said:

Are you buying the new place with a mortgage? If so, you'll probably have to tell the lender of your planned change in your financial circumstances (e.g. additional BTL mortgage payments). It might influence how much they are prepared to lend.

I don't know if it's feasible to go forward with 2 concurrent mortgage offers for your new place - one for if you take out a BTL mortgage as well, and one for if you don't take out a BTL mortgage.

That's a good point. I wonder how far I would get into the application before they wanted proof of my other mortgage offer 🤔

kingstreet

Your LTB app (let to buy!) will stall when the surveyor acting for the lender sees the property is on the market.

K_S

@snookie12cat It doesn't necessarily take two months to get a BTL remo from app to offer. Generally speaking, they're typically quicker than purchase mortgages as the underwriting is much more straightforward and the LTV is always low.

As the poster above said, the resi lender (if you're using a mortgage for the onward purchase) will need to know of it and factor it in to their decision. Some will take it all as a commitment as it's unlet, some will ignore it if the rent is sizeable enough and a couple will even take the future rental income into account to boost affordability.

Plus the BTL remortgage will need to be done with a lender who allows let-to-buy on their products where the applicant is letting the property they live in and moving to a new house.

Not complicated but personally I don't see why you'd want to do it unless it was definitely needed and the property was no longer on sale.

Snookie12cat

K_S said:

@snookie12cat It doesn't necessarily take two months to get a BTL remo from app to offer. Generally speaking, they're typically quicker than purchase mortgages as the underwriting is much more straightforward and the LTV is always low.

As the poster above said, the resi lender (if you're using a mortgage for the onward purchase) will need to know of it and factor it in to their decision. Some will take it all as a commitment as it's unlet, some will ignore it if the rent is sizeable enough and a couple will even take the future rental income into account to boost affordability.

Plus the BTL remortgage will need to be done with a lender who allows let-to-buy on their products where the applicant is letting the property they live in and moving to a new house.

Not complicated but personally I don't see why you'd want to do it unless it was definitely needed and the property was no longer on sale.

Thanks. My resi provider is really chill and have 0 problem me doing this and they will still offer me the mortgage on the same terms. 
I found NatWest who will do the let to buy and while ill probably get the offer in 3 weeks if i did it, it's the searches etc with the conveyancer which will delay it. 
I am just worried that I keep waiting for this buyer, in a month nothing is happening and then my seller pulls or refuses to wait another two months for me to sort the mortgage. I was hoping to shave some time off that if possible.

The property isn't on sale anymore and not on Rightmove so they will not know it's under offer currently. 

Snookie12cat

kingstreet said:

Your LTB app (let to buy!) will stall when the surveyor acting for the lender sees the property is on the market.

It's no longer on the market or even on Rightmove SSTC, so I don't think they will know. 

K_S

Snookie12cat said:

K_S said:

@snookie12cat It doesn't necessarily take two months to get a BTL remo from app to offer. Generally speaking, they're typically quicker than purchase mortgages as the underwriting is much more straightforward and the LTV is always low.

As the poster above said, the resi lender (if you're using a mortgage for the onward purchase) will need to know of it and factor it in to their decision. Some will take it all as a commitment as it's unlet, some will ignore it if the rent is sizeable enough and a couple will even take the future rental income into account to boost affordability.

Plus the BTL remortgage will need to be done with a lender who allows let-to-buy on their products where the applicant is letting the property they live in and moving to a new house.

Not complicated but personally I don't see why you'd want to do it unless it was definitely needed and the property was no longer on sale.

Thanks. My resi provider is really chill and have 0 problem me doing this and they will still offer me the mortgage on the same terms. 
I found NatWest who will do the let to buy and while ill probably get the offer in 3 weeks if i did it, it's the searches etc with the conveyancer which will delay it. 
I am just worried that I keep waiting for this buyer, in a month nothing is happening and then my seller pulls or refuses to wait another two months for me to sort the mortgage. I was hoping to shave some time off that if possible.

The property isn't on sale anymore and not on Rightmove so they will not know it's under offer currently. 

@snookie12cat Remortgages typically don't involve full searches, just indemnity insurance, so conveyancing can be super quick.

Snookie12cat

K_S said:

Snookie12cat said:

K_S said:

@snookie12cat It doesn't necessarily take two months to get a BTL remo from app to offer. Generally speaking, they're typically quicker than purchase mortgages as the underwriting is much more straightforward and the LTV is always low.

As the poster above said, the resi lender (if you're using a mortgage for the onward purchase) will need to know of it and factor it in to their decision. Some will take it all as a commitment as it's unlet, some will ignore it if the rent is sizeable enough and a couple will even take the future rental income into account to boost affordability.

Plus the BTL remortgage will need to be done with a lender who allows let-to-buy on their products where the applicant is letting the property they live in and moving to a new house.

Not complicated but personally I don't see why you'd want to do it unless it was definitely needed and the property was no longer on sale.

Thanks. My resi provider is really chill and have 0 problem me doing this and they will still offer me the mortgage on the same terms. 
I found NatWest who will do the let to buy and while ill probably get the offer in 3 weeks if i did it, it's the searches etc with the conveyancer which will delay it. 
I am just worried that I keep waiting for this buyer, in a month nothing is happening and then my seller pulls or refuses to wait another two months for me to sort the mortgage. I was hoping to shave some time off that if possible.

The property isn't on sale anymore and not on Rightmove so they will not know it's under offer currently. 

@snookie12cat Remortgages typically don't involve full searches, just indemnity insurance, so conveyancing can be super quick.

Ooo ok that's interesting. 

Do you know how far I am likely to get in the application before the lender will ask for proof of the onward mortgage offer? 

K_S

Snookie12cat said:

K_S said:

Snookie12cat said:

K_S said:

@snookie12cat It doesn't necessarily take two months to get a BTL remo from app to offer. Generally speaking, they're typically quicker than purchase mortgages as the underwriting is much more straightforward and the LTV is always low.

As the poster above said, the resi lender (if you're using a mortgage for the onward purchase) will need to know of it and factor it in to their decision. Some will take it all as a commitment as it's unlet, some will ignore it if the rent is sizeable enough and a couple will even take the future rental income into account to boost affordability.

Plus the BTL remortgage will need to be done with a lender who allows let-to-buy on their products where the applicant is letting the property they live in and moving to a new house.

Not complicated but personally I don't see why you'd want to do it unless it was definitely needed and the property was no longer on sale.

Thanks. My resi provider is really chill and have 0 problem me doing this and they will still offer me the mortgage on the same terms. 
I found NatWest who will do the let to buy and while ill probably get the offer in 3 weeks if i did it, it's the searches etc with the conveyancer which will delay it. 
I am just worried that I keep waiting for this buyer, in a month nothing is happening and then my seller pulls or refuses to wait another two months for me to sort the mortgage. I was hoping to shave some time off that if possible.

The property isn't on sale anymore and not on Rightmove so they will not know it's under offer currently. 

@snookie12cat Remortgages typically don't involve full searches, just indemnity insurance, so conveyancing can be super quick.

Ooo ok that's interesting. 

Do you know how far I am likely to get in the application before the lender will ask for proof of the onward mortgage offer? 

@snookie12cat I can't remember for NatWest off of the top of my head but even where the criteria says "needs the mortgage offer for the onward purchase prior to issue of the BTL offer", it's quite flexible in practice. They might be happy with the sol's confirmation, sales particulars and illustration, dip+illustration, etc.