Advice for my Father
Discussion
My Father was asking for my opinion on his situation.
Early 60's semi-retired, still works occasionally (runs his own business).
Own's a property valued around 900k (no mortgage), currently he rents it for 2,850 per month and is living in another part of the UK.
He would now like to buy a second place to live in, value approx 400k.
His thinking, take a small mortgage on the main property and buy for cash in his new location.
He believes there is a higher chance of capital preservation/appreciation for his main house and wants to keep it for the next 5-10yrs potentially.
What would people do in his situation? Just simply get a mortgage on the main house and pay cash for the second house?
Early 60's semi-retired, still works occasionally (runs his own business).
Own's a property valued around 900k (no mortgage), currently he rents it for 2,850 per month and is living in another part of the UK.
He would now like to buy a second place to live in, value approx 400k.
His thinking, take a small mortgage on the main property and buy for cash in his new location.
He believes there is a higher chance of capital preservation/appreciation for his main house and wants to keep it for the next 5-10yrs potentially.
What would people do in his situation? Just simply get a mortgage on the main house and pay cash for the second house?
If he took a mortgage out on his first house then it would need to be a BTL mortgage as it is rented out. A BTL mortgage typically is a higher interest rate (by 2% approx) than a residential mortgage. So my view would be he'd be better having a mortage on his new place.
But remember he'll need to pass affordability etc criteria.
But remember he'll need to pass affordability etc criteria.
MikeStroud said:
If he took a mortgage out on his first house then it would need to be a BTL mortgage as it is rented out. A BTL mortgage typically is a higher interest rate (by 2% approx) than a residential mortgage. So my view would be he'd be better having a mortage on his new place.
But remember he'll need to pass affordability etc criteria.
BTL rates are not 2% higher than residential rates.......But remember he'll need to pass affordability etc criteria.
chrishumes1978 said:
Advise is get to email sarnie...
I would second that.OP - send a PM to Sarnie, mortgage broker to the stars!
Seriously though, we recommend all of our Private Clients use him for mortgage and insurance needs as we know he has a huge commitment to service and is a real expert in what he does.
JulianPH said:
I would second that.
OP - send a PM to Sarnie, mortgage broker to the stars!
Seriously though, we recommend all of our Private Clients use him for mortgage and insurance needs as we know he has a huge commitment to service and is a real expert in what he does.
OP - send a PM to Sarnie, mortgage broker to the stars!
Seriously though, we recommend all of our Private Clients use him for mortgage and insurance needs as we know he has a huge commitment to service and is a real expert in what he does.
Thanks Julian, he helped my brother out in the past so will drop him a note.
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