Raising cash options

mne123

Hi guys,need a bit of input here.

I just have put an offer on the house as a cash buyer as the owners wants quick sale and cash buyers preferably and the house is really popular and the area is in demand. I will miss out if i dont do that. To do this I have borrowed the whole amount of the money from the family. 

Now,I have an outstanding mortgage of £77000 on the house I am currently living in which will go on sale soon. 

I am planning to port the outstanding mortgage onto the new property which should not be an issue, as the porting amount is &77000 compared to £475000 value of the house I will own outright.
Once I sell my current house I will use the whole funds to pay part of the loan to my family. 

The question I have is: is it possible to have remortgage or homeowners loan on my new property then to raise funds to repay the rest of the loan I owe to my family? I was advised there is a six month rule for homeowner loan upon purchasing a property? Can that be waived,I am not a developer,that is going to be my residential property I am living in.

Anyone in similar position has experience?

Thank you

Edi81

A broker will be best to confirm but I believe that porting can only be made to property that you don’t already own. 

Your plan won’t work as you will already own the property. 

georgehere

Hi mne123 - I also think you should talk to your solicitor and/or a mortgage broker.

It sounds like you are going to buy the new place outright - £475k cash, done deal, you own it. And you need to get advice on the implications of owning a second home because at that point you might be considered as owning 2 homes ... higher stamp duty on second homes etc ... if you have not by then sold your current home or maybe there is a way to make sure you don't get hit with the extra 2nd home tax.

Then, you will sell your current home and the mortgage might well have to be repaid there and then. Whether or not you can somehow retain this mortgage and port it needs advice.

Then you will need a new mortgage on your new place.

There may also be complications when you look for the new mortgage, as the lender might need to consider any implications of the amount borrowed from family - another reason for getting advice.

The question becomes, can you get the timing and financing of these 2 deals set up in such a way that you avoid paying extra stamp duty for a 'second' home and minimise the costs of the overall deal - which is why you are likely to see comments telling you to get professional advice.

I think we are all with you - it all sounds like a good plan - but given the wrinkles around 2nd homes, porting and mortgage acceptance criteria, it all adds up to a need for professional help.

Slinky

You'll also need to find the extra 3% stamp duty - £14250 which you should be able to claim back if you sell your original home within 3 years.

Jonboy_1984

It is possible with a GOOD experienced broker and solicitor. If a broker mentions land registry delays or similar as an issue then find another…

Six month rule is a guideline and key is getting on the electoral roll.

Double stamp duty will be involved.

Cannot comment on porting.

amnblog

You have a mini minefield on the go :

1. Porting a mortgage rate to a property you already own may well be an issue with your current Lender.
2. Many lenders will not allow you to re-mortgage until you have owned the new property for 6 months - this cannot be 'waived'
3. As stated above you will incur £14,250 additional stamp duty land tax. You can claim this back when you sell your current property but this needs to be allowed for in your cashflow.

Some Professional advice would not go amiss here.

dimbo61

Not sure of the sums involved but maybe an Offset mortgage might help you .
Worth checking out.