Want to move, but to avoid being in a chain I want to remortgage so I have the full cash available

robparry252

I've tried looking online for this scenario, but only seem to come up with Buy to Let advice.

I'm fortunate enough that I may be able to pay off our mortgage soon, but I also want to move house in the future.  What I want in regards to moving, is rather than getting into a chain and all the chaos that comes with it, is to own my current (mortgage free) home, remortgage against it for the full amount (or as much as possible) and use that 'cash in the bank' to be a cash buyer to buy our next property.

This way I'll have better leverage to buy our next home as we'd be a more attractive option for the seller and also to avoid being in a chain (from our end at least).

Once the new house is bought, we'd move in paying the remortgage on the old house until that old house is sold.

Is this a thing?.. Do mortgage companies allow this? and am I maybe better off not paying the full mortgage off when I can so I still have an open account with our current lender to remortgage with when the time comes?

Many thanks for any thoughts

housebuyer143

I think the issues is lenders will ask why you are remortgaging and if it's to buy another property they might not be happy that you will have 2 residential mortgages because as part of the loan you are agreeing to it live in it, but you won't be. 

What I did and what you might find is easier is to pay off the one you live in but you will need to have enough money for a deposit for the next one and then buying that one with the mortgage instead. While you won't be a cash buyer, most people without any issues in their credit etc can get a mortgage offer in a week or two, so you just get that and then you are ready to go, chain free. 
Once you sell the other one you will pay off the new one. 

ACG

When it comes to a remortgage saying you want £200k (for example) to sit in a bank account so you can buy a new home for cash when this is your home that their mortgage is secured against is not going to sit too well with the underwriters.

Knowing you will be paying it off also within 6-12 months is also going to go against you. 

Im not saying it cant be done, but I think you may struggle to get a mainstream lender to do it. 

jimjames

robparry252 said:

I've tried looking online for this scenario, but only seem to come up with Buy to Let advice.

I'm fortunate enough that I may be able to pay off our mortgage soon, but I also want to move house in the future.  What I want in regards to moving, is rather than getting into a chain and all the chaos that comes with it, is to own my current (mortgage free) home, remortgage against it for the full amount (or as much as possible) and use that 'cash in the bank' to be a cash buyer to buy our next property.

Maybe I'm missing something but if you don't need to sell your current house to buy the new one wouldn't it be easier to just buy that with the mortgage and keep your current one without it? You can then sell when you want and not be tied to a chain. Also means you don't have a period with mortgage being paid out and the money in bank at a lower rate.