raising capital

reubeno

hi

i own 2 properties, 1 i live in and 1 i rent out...both mortgage free.

how do i decide which property to raise capital with?

where am i best looking to raise the capital?

is this a better prospect than equity release?

thanks

reuben

Mr.Generous

Normally the more valuable property should be mortgaged, as whatever cash sum you raise will leave a higher deposit and a lower loan to value - therefore getting you a better interest rate. The complication would be if the rented out house is worth more, you'd have to compare interest rates on BTL as opposed to residential mortgages.

If a mortgage is off the agenda then it's going to come down to selling one of them, because equity release is really just that. Interesting concept to equity release a house that's let out - would any company take that on?

MWT

Mr.Generous said:

Interesting concept to equity release a house that's let out - would any company take that on?

Would not qualify for any standard Equity Release products as they all require the property to be the main residence of the owner(s).

The ER lenders are all looking for an easy sale when the time comes, so letting usually off the table, but I believe there may be a very small number that would let on a property if it is an AST, and of course no relatives allowed.

A mortgage would be the usual route to raising capital.