Advantage of remortgaging to buy second home?

okwd

Hi, I'm trying to understand the difference between these two situations. Suppose I own a house outright (worth 100) and have 20 in cash. If I want to buy a second home that's also worth 100 without selling my first one, I can either:

1. Use a single mortgage to buy the second home, with 20 in deposit and 80 in mortgage (80% LTV), or
2. Use two mortgages, remortgaging the first home, with 60 in equity and 40 in mortgage (40% LTV) for both homes.

Which of two is more common in practice? I guess that using two mortgages may be a little cheaper because of lower LTV and hence lower interest rate. But I'm not sure if remortgage rates are the same as normal mortgages.

Flugelhorn

depends what you to use the second house for - I did this once to buy a holiday let (in the days when that was far less hassle than now) - better to borrow against main house for that as the "holiday let" mortgages were more expensive