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Equity Release on a buy-to-let
Froglegs13
Posts: 1 Newbie
Hi, approx how much equity could I release on a property valued at circa £140,000 with £85,000 outstanding on the mortgage? Is it as simple as leaving 25% equity in the property and taking the rest? So approx £23,000 released? Also, is it subject to any tax because it is a buy to let and not main residence? Thanks
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Comments
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can you do equity release with BTL?
also possibly may be subject to CGT.0 -
down to the lender to decide. As you appreciate many lenders require minimum equity on a BTL mortgage, which may be 25% or may be higher. Look at some quote comparison websites.
the money released is not subject to any tax but please check if the interest will remain allowable as a cost against the rental income since there is a limit under what is called "withdrawing capital from a business". That means you may end up with some of the interest being disallowed as it is based on the value of the property when first let (ie date rental business started), not what it is worth at point of re-mortgaging.
BIM45700 - Specific deductions - interest: Withdrawal of capital from a business - HMRC internal manual - GOV.UK
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