Using rent to pay another mortgage

mrbonds

silvercar said:

The mortgage has to be taken out for the purpose of buying the BTL, it doesn’t matter where it is secured. So you’d be arguing that your mortgage on the new home is only needed because you are not selling your current home. I’m not sure the view hmrc would take on that. Better to get a BTL mortgage on your current place.

factor in an extra 5% SDLT on the new place

I'm not BLT , I'm going to be living in the new house straight away.   

Emmia

mrbonds said:

silvercar said:

The mortgage has to be taken out for the purpose of buying the BTL, it doesn’t matter where it is secured. So you’d be arguing that your mortgage on the new home is only needed because you are not selling your current home. I’m not sure the view hmrc would take on that. Better to get a BTL mortgage on your current place.

factor in an extra 5% SDLT on the new place

I'm not BLT , I'm going to be living in the new house straight away.   

But you'll "own" two properties, one you're living in and one you're renting out. The 5% will apply to the purchase of the second property. 

Emmia

mrbonds said:

Emmia said:

With no income, could you financially cover any voids in rent through having no tenants, or non paying tenants? 

Whether you remortgage against your current home or BTL that's something you need to seriously consider. 

It would go to a letting agency so they pay you regardless if the property is occupied or not. 

The letting agency will be pricing "void risk" into what they're willing to pay you (the rent from the tenants might be £1600, but you might end up with £1200), and that guarantee won't be open ended - I'd expect it to be for a maximum period.

You may find that they want the rent to be competitive to make the property attractive to avoid void periods between tenancies 

OP I get the sense you think this is an easy, cheap route (a fit and forget) to two properties and a chunk of cash in the future... That may not be the case.

A cautionary tale was in the guardian recently 
https://www.theguardian.com/society/2025/feb/20/the-cannabis-farm-scandal-how-a-rogue-lettings-agency-destroyed-countless-homes

mrbonds

Emmia said:

mrbonds said:

Emmia said:

With no income, could you financially cover any voids in rent through having no tenants, or non paying tenants? 

Whether you remortgage against your current home or BTL that's something you need to seriously consider. 

It would go to a letting agency so they pay you regardless if the property is occupied or not. 

The letting agency will be pricing "void risk" into what they're willing to pay you (the rent from the tenants might be £1600, but you might end up with £1200), and that guarantee won't be open ended - I'd expect it to be for a maximum period.

You may find that they want the rent to be competitive to make the property attractive to avoid void periods between tenancies 

OP I get the sense you think this is an easy, cheap route (a fit and forget) to two properties and a chunk of cash in the future... That may not be the case.

A cautionary tale was in the guardian recently 
https://www.theguardian.com/society/2025/feb/20/the-cannabis-farm-scandal-how-a-rogue-lettings-agency-destroyed-countless-homes

Thanks I was just looking at options.  I've already factored in the rent they have quoted me, ( so they already have their fees) leaves me with £1600-£1800 in hand. 

housebuyer143

mrbonds said:

Emmia said:

With no income, could you financially cover any voids in rent through having no tenants, or non paying tenants? 

Whether you remortgage against your current home or BTL that's something you need to seriously consider. 

It would go to a letting agency so they pay you regardless if the property is occupied or not. 

This comment scares me because it shows you haven't done any research. No agent pays you for voids unless you have leased it to a company or the council. I do not recommend this as it's a sure fire way to lose complete control over your property and end up with absolutely anyone in it. 
They might pay you for voids but they will not pay for thousands of pounds worth of damage 

mrbonds

housebuyer143 said:

mrbonds said:

Emmia said:

With no income, could you financially cover any voids in rent through having no tenants, or non paying tenants? 

Whether you remortgage against your current home or BTL that's something you need to seriously consider. 

It would go to a letting agency so they pay you regardless if the property is occupied or not. 

This comment scares me because it shows you haven't done any research. No agent pays you for voids unless you have leased it to a company or the council. I do not recommend this as it's a sure fire way to lose complete control over your property and end up with absolutely anyone in it. 
They might pay you for voids but they will not pay for thousands of pounds worth of damage 

My father uses them for another property and they pay every month. Any repairs come out of the money but they are few and far between - like new windows or other one offs.  It's just a shell of a place so there's no furniture that's worth anything. 

Emmia

housebuyer143 said:

mrbonds said:

Emmia said:

With no income, could you financially cover any voids in rent through having no tenants, or non paying tenants? 

Whether you remortgage against your current home or BTL that's something you need to seriously consider. 

It would go to a letting agency so they pay you regardless if the property is occupied or not. 

This comment scares me because it shows you haven't done any research. No agent pays you for voids unless you have leased it to a company or the council. I do not recommend this as it's a sure fire way to lose complete control over your property and end up with absolutely anyone in it. 
They might pay you for voids but they will not pay for thousands of pounds worth of damage 

Actually in London (at least) there are lots of agents that will do "guaranteed rent". A quick search brings up several e.g.

https://www.sandradavidson.com/guaranteed-rent-scheme/

https://www.elliotleigh.com/guaranteed-rent

https://www.finefair.com/guaranteed-rent/

The T&C's will be important. There is also risk they'll rent to "anyone",  including people the OP may not want living there or who cause substantial damage.

Emmia

mrbonds said:

housebuyer143 said:

mrbonds said:

Emmia said:

With no income, could you financially cover any voids in rent through having no tenants, or non paying tenants? 

Whether you remortgage against your current home or BTL that's something you need to seriously consider. 

It would go to a letting agency so they pay you regardless if the property is occupied or not. 

This comment scares me because it shows you haven't done any research. No agent pays you for voids unless you have leased it to a company or the council. I do not recommend this as it's a sure fire way to lose complete control over your property and end up with absolutely anyone in it. 
They might pay you for voids but they will not pay for thousands of pounds worth of damage 

My father uses them for another property and they pay every month. Any repairs come out of the money but they are few and far between - like new windows or other one offs.  It's just a shell of a place so there's no furniture that's worth anything. 

I wasn't thinking of furniture... Have you read the guardian article I linked to? Structural damage, tonnes of abandoned compost, dangerous wiring....

sheramber

you cannot deduct any capital repayment of the BTL mortgage from your rental income for tax purposes.

You can claim a credit from your tax due by calculating 20% of the interest paid. 

If you don’t work what is your income?
  If you are on means tested benefits then  the value of a BTL will  be considered as capital. 

mrbonds

sheramber said:

you cannot deduct any capital repayment of the BTL mortgage from your rental income for tax purposes.

You can claim a credit from your tax due by calculating 20% of the interest paid. 

If you don’t work what is your income?
  If you are on means tested benefits then  the value of a BTL will  be considered as capital. 

Hi. This will not be BTL . Just a normal mortgage on the new property.   Sorry it confusing