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Buy To Let
001220
Posts: 12 Forumite
Hi.
My partner and myself are currently looking at moving into a new property in the range of £260,000.
I currently own my own property, and based on valuations around the area it is valued to sell at £220,000, £40,000 more than I expected.
Based on the above coming true, my partner and I would have £150,000 in the pot after early repayment/solicitor/estate agent fees for selling her house.
We were originally going to sell my house, however we have also discussed moving my property to a buy to let mortgage and renting it out as an investment and money maker.
Would we have enough money in the pot to cover this? We would put around £60,000 in to the new house as a deposit, and £10,000 for stamp duty so that would leave us with £80,000.
How much money would I need to keep in my house to make a buy to let work, and what other fees would we have?
I’ve looked into it but slightly confused!
Many thanks for any help
My partner and myself are currently looking at moving into a new property in the range of £260,000.
I currently own my own property, and based on valuations around the area it is valued to sell at £220,000, £40,000 more than I expected.
Based on the above coming true, my partner and I would have £150,000 in the pot after early repayment/solicitor/estate agent fees for selling her house.
We were originally going to sell my house, however we have also discussed moving my property to a buy to let mortgage and renting it out as an investment and money maker.
Would we have enough money in the pot to cover this? We would put around £60,000 in to the new house as a deposit, and £10,000 for stamp duty so that would leave us with £80,000.
How much money would I need to keep in my house to make a buy to let work, and what other fees would we have?
I’ve looked into it but slightly confused!
Many thanks for any help
0
Comments
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@001220 You probably already know this, what you are proposing is called a let-to-buy transaction involving two simultaneous mortgages - one residential purchase (for your new-build property) and one BTL remortgage (for your current house). They need to complete on the same day or within a few days apart. Though there are a few quirks and criteria to meet on both sides of the transaction, it's a fairly straightforward process with the right lenders as long as the numbers add up. I would definitely recommend considering the use of a good broker, see here for those recommended on the MSE guide https://www.moneysavingexpert.com/mortgages/best-mortgages-cashback/#step3
Done properly, the background BTL property will be seen as self-sufficient and not impact on your affordability for the residential purchase. With a couple of lenders, they might even consider the future surplus rental income as additional income to boost affordability for the onward purchase.
You will need at least 25% equity in the rental property to be able to remortgage to a BTL, or a bit more depending on the rental estimates, etc.I am a Mortgage Adviser - 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
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