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Remortgaging Home : Can I convert my home (which has Equity loan) to buy to let in future?
John_New99
Posts: 3 Newbie
I have bought a house, 5 years ago, on mortgage £350,000 with £90,000 as initial deposit and remaining on mortgage. Now thanks to the market the value of the house gone up to £400,000. And I am in the market for remortgage of this house.
Query:
Looking to encash £50,000 (from £400,000) and invest this in a buy to let property. Bank is ready to provide me this equity at rate of 2.39 for next 5 years. Later on, can I convert my current home (which has Equity loan) to buy to let in future? Or do I need to pay the Equity loan first before converting it to buy to let
Query:
Looking to encash £50,000 (from £400,000) and invest this in a buy to let property. Bank is ready to provide me this equity at rate of 2.39 for next 5 years. Later on, can I convert my current home (which has Equity loan) to buy to let in future? Or do I need to pay the Equity loan first before converting it to buy to let
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Comments
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Your mortgage provider would need to provide consent for buy to let.0
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If you want to raise money you will have to ask permission from the first charge holder, your mortgage lender. You may also require the agreement of the second charge holder, depending on how it was set up.
You would normally be required to repay a Gov-funded Equity Loan (FB/HBD/HTB) before you can borrow more or let the property.I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0 -
zx81 said:Your mortgage provider would need to provide consent for buy to let.
Many thanks for your quick reply!kingstreet said:If you want to raise money you will have to ask permission from the first charge holder, your mortgage lender. You may also require the agreement of the second charge holder, depending on how it was set up.
You would normally be required to repay a Gov-funded Equity Loan (FB/HBD/HTB) before you can borrow more or let the property.
So, this means that this £50,000 will create First Charge and if I want to convert the current house to buy to let, this charge will not create any problem as long as mortgage lender is happy. Or I pass the affordability test.
Plus I don't need to pay this amount (£50,000) at the time of converting this to buy to let.
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Looking for your answers on mine queries. Many thanks.Many thanks for your quick reply!
So, this means that this £50,000 will create First Charge and if I want to convert the current house to buy to let, this charge will not create any problem as long as mortgage lender is happy. Or I pass the affordability test.
Plus I don't need to pay this amount (£50,000) at the time of converting this to buy to let.0
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