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  • FIRST POST
    • thereevester
    • By thereevester 12th Jul 18, 2:44 PM
    • 1Posts
    • 0Thanks
    thereevester
    Raise Capital from rental property to support main house move
    • #1
    • 12th Jul 18, 2:44 PM
    Raise Capital from rental property to support main house move 12th Jul 18 at 2:44 PM
    I own a property in my name only and have a mortgage on it. My wife also owns a property in her name which was gifted to her by her father last year and is owned outright. This is rented out.

    We want to move house but keep my wife's property. Can we raise some income from her property by getting a buy-to-let (?) mortgage which will be covered each month by the rental income.

    The idea is that the money raised from my wife's mortgage will go to our new house. At the same time, we will sell my house and I will get a new mortgage for the new house too.

    Is this feasible or can anyone see any complications?
Page 1
    • foxy-stoat
    • By foxy-stoat 12th Jul 18, 3:13 PM
    • 2,199 Posts
    • 1,188 Thanks
    foxy-stoat
    • #2
    • 12th Jul 18, 3:13 PM
    • #2
    • 12th Jul 18, 3:13 PM
    Speak to a broker, I am sure this is possible.
    • kingstreet
    • By kingstreet 12th Jul 18, 4:00 PM
    • 33,689 Posts
    • 18,268 Thanks
    kingstreet
    • #3
    • 12th Jul 18, 4:00 PM
    • #3
    • 12th Jul 18, 4:00 PM
    Yes. It's possible.

    If you plan to buy the new property alone with a gift from your wife be careful with the purchase mortgage as many lenders have an issue with someone contributing to the deposit and living in the property when they aren't party to the mortgage/ownership.
    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.
    • Jet
    • By Jet 12th Jul 18, 4:41 PM
    • 1,518 Posts
    • 974 Thanks
    Jet
    • #4
    • 12th Jul 18, 4:41 PM
    • #4
    • 12th Jul 18, 4:41 PM
    Also remember that the new mortgage can't be a tax deductible expense for the let property.
    • Thrugelmir
    • By Thrugelmir 12th Jul 18, 6:10 PM
    • 59,230 Posts
    • 52,612 Thanks
    Thrugelmir
    • #5
    • 12th Jul 18, 6:10 PM
    • #5
    • 12th Jul 18, 6:10 PM
    Can we raise some income from her property by getting a buy-to-let (?) mortgage which will be covered each month by the rental income.
    Originally posted by thereevester
    Is the net after tax income generated sufficient to repay the capital borrowed?
    Financial disasters happen when the last person who can remember what went wrong last time has left the building.
    • amnblog
    • By amnblog 13th Jul 18, 7:24 AM
    • 10,645 Posts
    • 4,212 Thanks
    amnblog
    • #6
    • 13th Jul 18, 7:24 AM
    • #6
    • 13th Jul 18, 7:24 AM
    This is a relatively common way of raising funds for a purchase.

    Things can get tricky however, if you do not use an experienced mortgage broker.
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, 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.
    • Mortgage_Adviser
    • By Mortgage_Adviser 13th Jul 18, 3:36 PM
    • 155 Posts
    • 50 Thanks
    Mortgage_Adviser
    • #7
    • 13th Jul 18, 3:36 PM
    • #7
    • 13th Jul 18, 3:36 PM
    As long as in lender's eyes buy to let mortgage is 'affordable' based on their stress testing see no reason why this can not be done.
    Done plenty of those.
    • heston2014
    • By heston2014 14th Jul 18, 10:56 AM
    • 35 Posts
    • 6 Thanks
    heston2014
    • #8
    • 14th Jul 18, 10:56 AM
    • #8
    • 14th Jul 18, 10:56 AM
    We are currently going through a similar process, living in house which we are looking to rent out to buy a second home.
    Definitely speak to a broker as we found that 'Let to Buy' are a bit complex and there are certain types of properties that lenders would not consider. We are remortgaging to raise funds from our property but it has 'decked access' where the front door is on a communal balcony/walkway. Consequently, this has limited lenders that consider such but our broker has managed to find lenders and we have submitted our application, awaiting outcome. Rates are slightly higher but there are lenders that do 'let to buys', however, quite limited.

    Goodluck!
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