Buy to let mortgage options
Discussion
I'm keen to remortgage a property which is on SVR buy to let with TMW currently.
Objective I want to increase the BTL mortgage so it increases my interest payment to net off partly against the tax changes coming shortly and put he cash into my residential property mortgage saving interest on my offset mortgage and be ready for the funding of my extension over remortgaging my prevailing residential mortgage.
Things seemed to have changed from when I last sorted out my mortgage - so which is the best option currently to maximise cash out without the silly mortgage cover rate at very high interest?
Objective I want to increase the BTL mortgage so it increases my interest payment to net off partly against the tax changes coming shortly and put he cash into my residential property mortgage saving interest on my offset mortgage and be ready for the funding of my extension over remortgaging my prevailing residential mortgage.
Things seemed to have changed from when I last sorted out my mortgage - so which is the best option currently to maximise cash out without the silly mortgage cover rate at very high interest?
Welshbeef said:
I'm keen to remortgage a property which is on SVR buy to let with TMW currently.
Objective I want to increase the BTL mortgage so it increases my interest payment to net off partly against the tax changes coming shortly and put he cash into my residential property mortgage saving interest on my offset mortgage and be ready for the funding of my extension over remortgaging my prevailing residential mortgage.
Things seemed to have changed from when I last sorted out my mortgage - so which is the best option currently to maximise cash out without the silly mortgage cover rate at very high interest?
Is there a question in there? Objective I want to increase the BTL mortgage so it increases my interest payment to net off partly against the tax changes coming shortly and put he cash into my residential property mortgage saving interest on my offset mortgage and be ready for the funding of my extension over remortgaging my prevailing residential mortgage.
Things seemed to have changed from when I last sorted out my mortgage - so which is the best option currently to maximise cash out without the silly mortgage cover rate at very high interest?
Sarnie said:
Is there a question in there?
Who is there to go to to avoid the high % stress test ie so that I can maximise the loan on the property (only looking to go up to 75%) and simply put those funds into my mortgage saving interest costs there and reducing as much tax liability as I can. Welshbeef said:
Who is there to go to to avoid the high % stress test ie so that I can maximise the loan on the property (only looking to go up to 75%) and simply put those funds into my mortgage saving interest costs there and reducing as much tax liability as I can.
Lots of variables at play here........What is the value of the property?
How much are you wanting to lend?
What is the current rental?
What are your annual earnings?
How many mortgaged BTL's do you own?
Welshbeef said:
Sarnie said:
Is there a question in there?
Who is there to go to to avoid the high % stress test ie so that I can maximise the loan on the property (only looking to go up to 75%) and simply put those funds into my mortgage saving interest costs there and reducing as much tax liability as I can. For example. When you first rented it out the place was worth £100K with a £65K mortgage. But that was 10 years ago.... Today it's worth £175K, regardless of what mortgage you can raise you can only offset the interest on the first £100K of mortgage against tax.
Sir Bagalot said:
Maximise your loan by all means but remember that you can only offset interest on a loan equivelent you the value of the property when it first entered the rental market, not what it's worth today.
For example. When you first rented it out the place was worth £100K with a £65K mortgage. But that was 10 years ago.... Today it's worth £175K, regardless of what mortgage you can raise you can only offset the interest on the first £100K of mortgage against tax.
The key is how many of the 3.5 million landlords do this?For example. When you first rented it out the place was worth £100K with a £65K mortgage. But that was 10 years ago.... Today it's worth £175K, regardless of what mortgage you can raise you can only offset the interest on the first £100K of mortgage against tax.
Also if it moves from principle primary residence to let then 35 months later back to principle then moves back again etc.
Sarnie said:
How many mortgaged BTL's do you own?
I never realised that this would count against me when i applied for a new mortgage. Even though rental income covered repayments by 100% and none of the LTV's exceeded 30% First Direct turned me down on the basis that if they ALL became unocuupied at the same time, i'd have 2 lots of extra Mortgage payments plus 4 lots of council tax / water rates etc etc....
Countdown said:
I never realised that this would count against me when i applied for a new mortgage. Even though rental income covered repayments by 100% and none of the LTV's exceeded 30% First Direct turned me down on the basis that if they ALL became unocuupied at the same time, i'd have 2 lots of extra Mortgage payments plus 4 lots of council tax / water rates etc etc....
Yep, it's a very salient point...........every lender will have a limit to the portfolio size they are happy to accept......as you experienced with FD Welshbeef said:
Sir Bagalot said:
Maximise your loan by all means but remember that you can only offset interest on a loan equivelent you the value of the property when it first entered the rental market, not what it's worth today.
For example. When you first rented it out the place was worth £100K with a £65K mortgage. But that was 10 years ago.... Today it's worth £175K, regardless of what mortgage you can raise you can only offset the interest on the first £100K of mortgage against tax.
The key is how many of the 3.5 million landlords do this?For example. When you first rented it out the place was worth £100K with a £65K mortgage. But that was 10 years ago.... Today it's worth £175K, regardless of what mortgage you can raise you can only offset the interest on the first £100K of mortgage against tax.
Also if it moves from principle primary residence to let then 35 months later back to principle then moves back again etc.
s off in life. 1/ The Tax Man, 2/ The VAT man
Sir Bagalot said:
Personally I don't give a monkeys jot what you do as it isn't me you have to satisify. You do howvwe have to satisify the taxman, and there are two people you should never ps off in life. 1/ The Tax Man, 2/ The VAT man
I think it's fair to say most landlords don't really know that rule - or lip service at best. s off in life. 1/ The Tax Man, 2/ The VAT manAs this is the Internet I've never extended the mortgage on any of my B2Ls so based on that I'm within this rule (and hands up I wasn't aware). I was aiming to reduce tax bill but legally I cannot balls.
In which case I'll offer the old man slightly less terms than my mortgage would be for additional borrowing and clearly no set up fee. Bank of mum and Dad cannot beat it - plus nothing official so 7 year applies
Gassing Station | Finance | Top of Page | What's New | My Stuff