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Renting current property to buy another [Merged]

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stacie0395
stacie0395 Posts: 14 Forumite
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edited 28 May at 9:49AM in House buying, renting & selling
Hi all,
Has anyone done this?
Is is straightforward logistically when the mortgages all swap over?
We are relying on the equity for the new houses deposit.

Thanks 
Stacie 
«13

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  • stacie0395
    stacie0395 Posts: 14 Forumite
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    Hi all,

    We have had a mortgage approved for a new house and to change our current to a buy to let to free up equity.

    We need this equity to pay towards the deposit and stamp duty etc. 

    Does anyone know how it works on timings of getting the money from the swap? Obviously we can't move out until we complete, but ideally we need the money before we exchange.

    Alternatively, how likely is it to be accepted to offer a 5% deposit at exchange?

    I need to discuss with my solicitor but it's bank holiday weekend and I'm stressed 😫 

    Thank you 
  • AskAsk
    AskAsk Posts: 2,632 Forumite
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    edited 28 May at 9:48AM
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    I doubt you will get a buy to let mortgage on your house if you are still living in it!  Have you applied for a buy to let mortgage?
  • stacie0395
    stacie0395 Posts: 14 Forumite
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    edited 28 May at 9:48AM
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    Yes it's all approved ready AskAsk said:
    I doubt you will get a buy to let mortgage on your house if you are still living in it!  Have you applied for a buy to let mortgage?

  • AskAsk
    AskAsk Posts: 2,632 Forumite
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    edited 28 May at 9:48AM
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    stacie0395 said:
    Yes it's all approved ready AskAsk said:
    I doubt you will get a buy to let mortgage on your house if you are still living in it!  Have you applied for a buy to let mortgage?

    I didn't think they would give you a BTL mortgage until you had moved out.  Why don't you ask the lenders as they are the ones that would be sending the money over.
  • stacie0395
    stacie0395 Posts: 14 Forumite
    First Post Combo Breaker First Anniversary
    edited 28 May at 9:48AM
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    AskAsk said:
    stacie0395 said:
    Yes it's all approved ready AskAsk said:
    I doubt you will get a buy to let mortgage on your house if you are still living in it!  Have you applied for a buy to let mortgage?

    I didn't think they would give you a BTL mortgage until you had moved out.  Why don't you ask the lenders as they are the ones that would be sending the money over.
    So the mortgages will have to complete at the same time, so we will be moving into the new property when it starts. 
  • Flugelhorn
    Flugelhorn Posts: 5,796 Forumite
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    so what are you doing? changing your current mortgage to a larger BTL mortgage and taking some of spare cash to buy the new house?  presume have to leave some equity in BTL

    If buying new house may have to put deposit down at exchange as you are not selling and not passing deposit up chain - this can be 10%
  • housebuyer143
    housebuyer143 Posts: 3,510 Forumite
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    edited 28 May at 9:48AM
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    You can't have the money before you exchange. You will be in breach of the mortgage offer and the solicitor will not allow this. You will have to do them simultaneously on completion day. 
    Why do you need the money before exchange? If you need an exchange deposit you will have to explain you can't get one and hope the other side agrees to this.
  • stacie0395
    stacie0395 Posts: 14 Forumite
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    Yes we've had our financial advisor sort out how much we can free etc, I just need to understand the logistics. 
    We only have 5% free cash so have asked our solicitor to negotiate this for us at exchange. I'm hoping it's doable! 
  • Flugelhorn
    Flugelhorn Posts: 5,796 Forumite
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    sounds a bit risky only having that much spare cash - owning 2 properties, paying higher SDLT and potentially costs for both properties - but I wouldn't know the ins and outs of it all

    anyway - they may be able to negotiate it for you
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