Remortgage + Raising Capital

Idgam

Good Evening all, I have been reading the forum quite a bit of late but have not found a suitable answer to my question.

I currently have a mortgage with Birmingham Midshires for £64,500 interest only with 16 years to go on SVR (7.94:eek: ). I also have a non interest bearing loan on the same property for £27,500 (this is not repayable until the house is sold or the mortgage company is swapped). I have an endowment to cover the £64500.

I need to raise an extra £50,000 as I am involved in a company buyout.

How would you guys do it i.e. remortgage the whole lot of get a loan?

The company will pay me around £800 net per month over 5 years to pay back the £50,000 and if I cashed in all my premium bonds and savings I could raise around £35,000. I would like to keep the endowment as a savings vehicle as well as life cover if possible.

To compound the problem we will be looking to move in the next few months and I will be looking to add another £100,000 to my mortgage to move to a better area so I would need something portable. Any suggestions?

beecher

think you need to post your household's income, and the value of your present house to get a proper answer from someone.

Idgam

My basic is around £40,000 and my wifes is £8,000. As I said i would also receive a "loan repayment" - tax free of around £800 per month for 5 years.

I get annual bonuses of around £10,000 and I would also receive dividends if the company does well.

beecher

And how much equity do you have? Hopefully someone who knows more will be along soon as I don't have a clue if the loan repayment is counted for mortgage purposes or not. I take it you've got a solicitor involved in working out the buyout?

Idgam

The current house is valued at around £250,000.

Yes we do have a solicitor. Makes me think I am in the wrong profession her charges are huge.

neverdespairgirl

Idgam wrote: »

Yes we do have a solicitor. Makes me think I am in the wrong profession her charges are huge.

Doubt it - most solicitors earn less than £40k!

silvercar

neverdespairgirl wrote: »

Doubt it - most solicitors earn less than £40k!

:rotfl: :rotfl: :rotfl:

Never met a poor solicitor in my life!

homer_j_3

The business you are buying out, is it established with proven accounts?
Have you considered what would happen if the business declined?

The income you have of 48k - if income through PAYE then you should be able to borrow the 142k based on this income without the need to consider the extra 9600 you will be getting from the business.

Do you have any other debts or issues with your credit (now or historically)?

If you are thinking of moving then I would probably be saying that you need to look for a no tie in product rather than portability because portability is not guaranteed and with lending criteria tightening by the day, I would not want to run the risk of you being hit with a nasty ERC.

Just to add: If you are looking to borrow an extra 100k on top in the near future, you may need to use the extra 10k of income to get that level of borrowing so dependent on company accounts and how you are classed with that business (director on PAYE or self employed etc) will determine how the next mortgage goes.

HTH