Buying a house before selling current one
Discussion
We’ve found a house we’d like to buy but may need to move to buy it pretty quickly.
Currently have about £600k equity in our current house (with £75k outstanding mortgage)
The other house is around £420k and we’d plan on spending £150-200k on it. ( quite a chunk of that spend can come from savings)
Plan was to remortgage current house, buy the other and then pay off the mortgage once we’d sold the current house.
According to Nationwide who we have the mortgage with, this constitutes short term lending which they don’t do.
So I assume the only option is bridging loans?
I’m trying all permutations re financing but sure i must be missing various options.
Anyone able to throw some light onto this predicament please?
Many thanks.
Currently have about £600k equity in our current house (with £75k outstanding mortgage)
The other house is around £420k and we’d plan on spending £150-200k on it. ( quite a chunk of that spend can come from savings)
Plan was to remortgage current house, buy the other and then pay off the mortgage once we’d sold the current house.
According to Nationwide who we have the mortgage with, this constitutes short term lending which they don’t do.
So I assume the only option is bridging loans?
I’m trying all permutations re financing but sure i must be missing various options.
Anyone able to throw some light onto this predicament please?
Many thanks.
Depends why you want two houses.
We've twice bought before selling.
First time we were able to pay off one house and port the mortgage to the new house, re-drawing some of what we'd already repaid.
The lender was grumpy about this, but it was what they'd sold us 15 years previously.
Second time, we were offered some quite good deals to mortgage house 2 as a BTL, which would have enabled us to buy house 3 for cash.
The fact that your plans to let out your current house don't quite happen may not concern a BTL lender?
We've twice bought before selling.
First time we were able to pay off one house and port the mortgage to the new house, re-drawing some of what we'd already repaid.
The lender was grumpy about this, but it was what they'd sold us 15 years previously.
Second time, we were offered some quite good deals to mortgage house 2 as a BTL, which would have enabled us to buy house 3 for cash.
The fact that your plans to let out your current house don't quite happen may not concern a BTL lender?
OutInTheShed said:
Depends why you want two houses.
We've twice bought before selling.
First time we were able to pay off one house and port the mortgage to the new house, re-drawing some of what we'd already repaid.
The lender was grumpy about this, but it was what they'd sold us 15 years previously.
Second time, we were offered some quite good deals to mortgage house 2 as a BTL, which would have enabled us to buy house 3 for cash.
The fact that your plans to let out your current house don't quite happen may not concern a BTL lender?
No letting out the current house - will sell it, the other house will be our only residence.We've twice bought before selling.
First time we were able to pay off one house and port the mortgage to the new house, re-drawing some of what we'd already repaid.
The lender was grumpy about this, but it was what they'd sold us 15 years previously.
Second time, we were offered some quite good deals to mortgage house 2 as a BTL, which would have enabled us to buy house 3 for cash.
The fact that your plans to let out your current house don't quite happen may not concern a BTL lender?
You have lots of equity buffer, but it’s a slightly risky time to be doing it. You could be exposed to 2 houses falling in value and your current house taking some time to sell.
Sure it will be fine, but plan for the worst case.
Nothing unethical at all in taking a mortgage and paying it off early if the numbers work.
Sure it will be fine, but plan for the worst case.
Nothing unethical at all in taking a mortgage and paying it off early if the numbers work.
dmahu said:
You have lots of equity buffer, but it’s a slightly risky time to be doing it. You could be exposed to 2 houses falling in value and your current house taking some time to sell.
Sure it will be fine, but plan for the worst case.
Nothing unethical at all in taking a mortgage and paying it off early if the numbers work.
Yes, certainly a dodgy time to be thinking of it, but a house we want hasn’t come up for sale until now typically!Sure it will be fine, but plan for the worst case.
Nothing unethical at all in taking a mortgage and paying it off early if the numbers work.
The next house will be our final one so I’m not overly worried about the price of that going south.
The plan would be to be mortgage free in 4 years anyway, as we would be if we stayed here.
Can reclaim the stamp duty as long as we sell the existing house within 36 months
2 sMoKiN bArReLs said:
Don't forget the extra 3% stamp duty for the second home. (Although you can claim it back within a time frame).
....assuming this is still a "thing".
It is. But I have recently reclaimed this on behalf of my mother (she sold what was the family house, having moved to a smaller flat) and the cash turned up in 2 weeks. Pleasantly surprised. ....assuming this is still a "thing".
Square Leg said:
Plan was to remortgage current house, buy the other and then pay off the mortgage once we’d sold the current house.
According to Nationwide who we have the mortgage with, this constitutes short term lending which they don’t do.
We did exactly this with the Nationwide albeit back in 2013 when we bought our current house. My wife saw her dream house and we had to move fast at the time so didn’t have chance to market ours. I thought the Nationwide wouldn’t even entertain it but they made us a mortgage offer based on us finding £50k for a deposit very quickly and it all went through. According to Nationwide who we have the mortgage with, this constitutes short term lending which they don’t do.
We had two houses for a year as our old one took a while to sell, but we used the equity to do up the new house. Ultimately we were getting a new mortgage on the new place and paying off an old mortgage on the old place, so none of the lending was short term I suppose.
Skyedriver said:
Sarnie said:
Speak to a broker, this is what they are there for!
No direct experience personally but there goes the voice of PHI've never asked Sarnie to help but plenty on here have.
The broker I've worked with has helped me loads as I've bought and sold a number of properties and had a load of renewals.
With a complex case like this and a tricky market it's a no brainer.
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