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    • eldaniel
    • By eldaniel 14th Oct 16, 6:47 PM
    • 224Posts
    • 90Thanks
    collateral mortgage vs capital release mortgage
    • #1
    • 14th Oct 16, 6:47 PM
    collateral mortgage vs capital release mortgage 14th Oct 16 at 6:47 PM
    Hope I can explain what I mean in the way everyone can understand...
    I am aware that collateral mortgages are not offered anymore but are capital release mortgage work in similar way?
    Using below example:
    Couple can get the standard mortgage to the max. amount 100k if they are selling their property and upsizing to another one.

    However they own outright the property they live in and they could consider buying second one without selling their main property.

    Would the combined mortage amount and capital release amount, still total up to 100k or because they own one property already lender would be willing to give them more because at the end of the day they have potentially 2 properties they could repossess to get their money back?

    Also working on assumption that this couple is under the age of 50.

Page 1
    • kingstreet
    • By kingstreet 14th Oct 16, 7:27 PM
    • 33,338 Posts
    • 18,030 Thanks
    • #2
    • 14th Oct 16, 7:27 PM
    • #2
    • 14th Oct 16, 7:27 PM
    No. You don't get to borrow more because you have more equity.

    Your borrowing power is based only on your income and outgoings. These are assessed in different ways by different lenders.

    You sound like you need to speak to a broker.

    Finally, the ability to cross-charge (have a mortgage spread over two or more properties ended in the residential market when the One Account stopped new lending.)
    I am a mortgage broker. 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. Please do not send PMs asking for one-to-one-advice, or representation.
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