Paid off my previous mortgage but now need a new one ?

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davebrads1972
davebrads1972 Posts: 1 Newbie
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in Mortgages & endowments
I paid off my previous mortgage a few years and now fully own my current home valued at a modest £90,000 approximately. I now wish to move into a larger property in the range of £150,000 to £200,000 so need a new mortgage to cover.
I have at least £25,000 in cash to put down for a deposit. Where do I start ? Am I classed as a first time buyer, remortgage etc. etc. Do i get a £100,000 mortgage and pay a bigger deposit (up to £50,000) or a smaller mortgage and keep my savings in my ISA ? Any help would be great....

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  • MovingForwards
    MovingForwards Posts: 16,923 Forumite
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    You own a property so are not classed as a first time buyer. You are not remortgaging your current property (I assume) and will be selling it to move up the ladder.

    The equity in your current home can be used as your mortgage deposit.

    You could then keep most of your savings as savings, allowing ready access for moving/solicitors fees and any bits you want for your new home.

    Find a good independent mortgage broker to help you secure the right mortgage for you.
    Mortgage started 2020, aiming to clear it in 2026.
  • ACG
    ACG Posts: 23,727 Forumite
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    Most people want to put down as much as they can so their monthly commitments are less, less interest and it is easier to keep on top of everything. Other people are happy to hold money back and put it in a savings account either because the savings pay more or so they can hold money back for a rainy day.

    The important question is what do you want from your Mortgage?

    That will then help you decide on what to do going forward.

    If you are moving house, it will be a purchase. You are not a first time buyer as you currently own a property. There will be stamp duty payable.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • sal_III
    sal_III Posts: 1,953 Forumite
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    You are not classed as a first time buyer and can't sue SDLT relief. But if you sell your exisitng property you won't have to pay the 3% surcharge for second property.

    You can use HTB equity loan to buy a new build if you simultaneously sell your current home.

    The proceeds from the sale of your home can go towards the deposit for the new property alongside your savings, or some of it for deposit and some of it to boost your savings. Your choice.

    Most saving accounts interests are lower than the mortgage, so makes no sense to take bigger mortgage to keep money in them (apart from a rainy day/contingency fund).

    Alternatively, if you want to keep the existing property as investment/pension and fancy becoming a Landlord (not a job for everyone) you can take what is called a "let to buy" mortgage. Meaning that you will take a mortgage on your existing home and let it out, repaying the mortgage with the rent. and use the released equity as a deposit for your new home.
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