2nd mortgage

83dons2

I have a flat worth about 90k I am trying to sell that i have about 35k equity in. I have 24k in bank. I am looking to purchase a second home of around 240k value. Ideally I would sell before buying but iv seen somewhere I like and want to put an offer in no without having sold yet. In Scotland so will generate LBTT of about 2k and there is the additional dwelling supplement of about 10k. I guess I can take 10k gamble on selling within 18 months and I think I can afford to pay both mortgages n meantime to first flat sells. My main question is Santander will only offer me 20% deposit min on second property with them does anyone offer smaller deposits nearer 10% maybe on a second property knowing that I will hopefully be selling the first one. I presume I cant avoid ADS tax? Is a mortgage advisor the best place to get the best deal for this second home or is that wasting money on commission?

K_S

@83dons2 With respect to the mortgage part of your post - most lenders will have a 75/80/85% LTV cap on second home but there are lenders who will consider 90% LTV lending on second homes, depending on the rest of the circumstances and both mortgages being affordable (as per lender calculators) on your income. 

I would recommend considering the use of a mortgage broker. It doesn't have to cost you anything, there are plenty of fee-free brokers recommended in the MSE guidance here. Good luck!
https://www.moneysavingexpert.com/mortgages/best-mortgages-cashback/#step3

83dons2

Thanks for the info. How do the fee free mortgage advisors work? I have asked to see one within a local solicitor I contacted as my friend used them but I guess they will charge a fee.

K_S

83dons2 said:

Thanks for the info. How do the fee free mortgage advisors work? I have asked to see one within a local solicitor I contacted as my friend used them but I guess they will charge a fee.

@83dons2 I'm not sure I understand the question but here goes - almost all whole of market brokers (fee-charging or fee-free) will have their main income from what is called a 'procuration-fee' from the lender, you can call it commission. This is usually around 0.3-0.4% of the loan-size. The broker fee charged to the applicant (if any) is on top of that. The procuration fee and the broker fee (if any) have no bearing on the rate/product that the client gets.

The procuration-fee will be listed on the illustration that the broker sends when recommending a product. The broker-fee (if any) will be made clear upfront when you sign up.

83dons2

Ok thanks. A lot of the online ones don't really provide the opportunity to speak with an advisor I notice as its kind of hard to explain my position via online calculators. I will click through them and see if any allow chat to a real person.

simon_or

83dons2 said:

Ok thanks. A lot of the online ones don't really provide the opportunity to speak with an advisor I notice as its kind of hard to explain my position via online calculators. I will click through them and see if any allow chat to a real person.

Ask family and friends, they might know of smaller firms that don't charge a fee (or only charge a small one) and are easier to actually speak to.