Help buying a new home before selling

Spraymanuk wrote: »

Hi first time posting for me so hi everyone.
I am after some advice here.
Currently we have a house (in the East Midlands) which is Mortgage free As we paid it off a few years ago. It is an older property and it’s value is circa £275K.
We are desperate to move house but we know that to give it kerb appeal we need to get painted and tarted up inside and out.
We also know that it wont sell quickly. Thought it is a nice house.
Anyway as I say we would like to buy another house for around £400K, which would give us time to move out (I have a double garage with part built car, machine tools etc) and then leave the house empty for the decorators to work there magic.

What options do I have here? I can afford to but down a 15% deposit on the new house and then pay back a big lump sum when our house sells, leaving a smaller mortgage. I am in my mid 50s and have a very good salary. Checking mortgage tools states they would allow up to a £375K mortgage if needed.
What are the implications of what I am proposing here. Anything I have missed?

Any advice would be welcomed.

Very similar situation to us - we are a year on from that......our previous house (no mortgage) had been on the market and not sold and meanwhile a house that we were very interested in and didn't want to lose out on, went for sale on modern auction. We had talked to the estate agent and decided to see if we could make a bid which we did and we got a mortgage broker involved to release the capital from our current house to use as a deposit (changed to an interest free BTL mortgage) and then took out our new house mortgage. It was tense for a couple of weeks until all the finances were sorted but it worked out for us. We had the extra stamp duty to pay (so £32k rather than £16k which we had calculated into our decision - but then we knew we would be able to claim this back within 3 years of selling our house and now the house is sold subject to contract and exchanging soon.

Now the downside which you may or may not be caught out on......we were planning to do the same as you as we wanted to do some renovations and move gradually when we had completed .....however the BTL arrangement meant that we could not live there even temporarily when we converted the mortgage so we moved "most" of our stuff and then spent the next months emptying the loft and garage (2 cars mid renovation, and years of metalwork projects and tools........)

So it can be done - we were lucky as we are on very good salaries and had worked hard to pay off our previous mortgage, it was tense taking on a big mortgage but we will work hard to get that down ASAP and it has given us an amazing property that instantly felt like ours which was double the size with an amazing garden in an ideal position (our old house even though we lived there 19 years it never felt like home so it was meant to be!)

Other cost wise our savings have soon been depleted moving into an old house by upgrading heating, adding fireplaces/stoves/electrics and unexpected issues so don't forget to work out all your new costs (inc council tax and bills assuming you are moving into a bigger place)

Oh and lastly, we had to take out landlords insurance as our old house being a BTL (even though we had no intention of letting out)

Hope that helps

SLM

Mutton_Geoff wrote: »

Are you sure you're covered for a long vacant period with no effort to get the house occupied. I think a claim might be met with rejection if you were discovered doing this. You need FLEA insurance, not landlords insurance in this situation.

Yes - we are covered thanks I checked with the insurers

SLM