Do I have to get 'Let to buy' mortgage?
Discussion
Hi,
Can anybody help clarify something. We are looking to buy a second home and rent our current property out. I have spoken to 2 FA's and the first one said, 'No problem', took some details and gave me some figures based on mortgage values I.e. 180K and 150K. Rates were quite favourable but for some reason it seemed a bit too 'easy'.
I have spoken to a second FA (who I have dealt with for years) and said they must be residential mortgages and what I need is let to buy with rates way in excess of what the other guy quoted. He is going away to do some more digging for me, but he said there is only 2 ways to do it:
1) change our current mortgage to buy to let and get a residential mort on the new property. (Our current rate though is very low)
2) Keep as is and do let to buy on the new house - paying a fortune on rates around 6%!! There are lower rates but have a 3% arrangement fee!!!!
3) Or sell our house, but I would probably end up not getting back what we owe on it (Had it valued yesterday).
Is it really the case that you can't get another residential mortgage?
Sorry for all the questions, but a bit confused.com!
Cheers,
Dave
Can anybody help clarify something. We are looking to buy a second home and rent our current property out. I have spoken to 2 FA's and the first one said, 'No problem', took some details and gave me some figures based on mortgage values I.e. 180K and 150K. Rates were quite favourable but for some reason it seemed a bit too 'easy'.
I have spoken to a second FA (who I have dealt with for years) and said they must be residential mortgages and what I need is let to buy with rates way in excess of what the other guy quoted. He is going away to do some more digging for me, but he said there is only 2 ways to do it:
1) change our current mortgage to buy to let and get a residential mort on the new property. (Our current rate though is very low)
2) Keep as is and do let to buy on the new house - paying a fortune on rates around 6%!! There are lower rates but have a 3% arrangement fee!!!!
3) Or sell our house, but I would probably end up not getting back what we owe on it (Had it valued yesterday).
Is it really the case that you can't get another residential mortgage?
Sorry for all the questions, but a bit confused.com!
Cheers,
Dave
Are you capital raising on the old property to buy the new one?
If not have you spoken to your current lender about permission to let. (Not all lenders will give it. Most wont if you are taking money out at the same time)
What is your ltv? BTL is expensive, and there is very little appetite to lend above 75% LTV.
If not have you spoken to your current lender about permission to let. (Not all lenders will give it. Most wont if you are taking money out at the same time)
What is your ltv? BTL is expensive, and there is very little appetite to lend above 75% LTV.
Not asked for consent to lease yet, although vibes are that RBS are quite good with this.
LTV on the new house is 75%, At the minute we have 25% dep.
Supposing RBS allow us to rent based on current mortgage (baring in mind rentals would be about 250% of current mortgage payments , do we have to do let to buy for the second home (which will be our place of residence)?
LTV on the new house is 75%, At the minute we have 25% dep.
Supposing RBS allow us to rent based on current mortgage (baring in mind rentals would be about 250% of current mortgage payments , do we have to do let to buy for the second home (which will be our place of residence)?
davy9449 said:
Not asked for consent to lease yet, although vibes are that RBS are quite good with this.
LTV on the new house is 75%, At the minute we have 25% dep.
Supposing RBS allow us to rent based on current mortgage (baring in mind rentals would be about 250% of current mortgage payments , do we have to do let to buy for the second home (which will be our place of residence)?
No, if RBS give you consent to let most lenders will allow you to have a resi on the new place LTV on the new house is 75%, At the minute we have 25% dep.
Supposing RBS allow us to rent based on current mortgage (baring in mind rentals would be about 250% of current mortgage payments , do we have to do let to buy for the second home (which will be our place of residence)?
You shouldnt have a BTL on your home. Big no-no
scotal said:
No, if RBS give you consent to let most lenders will allow you to have a resi on the new place
You shouldnt have a BTL on your home. Big no-no
Ok Thanks, can you tell me how you know this? I'm not being funny, it's just that if this is definitely the case and my FA comes back with his same argument, then I think I need to go elsewhere don't I really?You shouldnt have a BTL on your home. Big no-no
IMHO the second IFA is wrong. Perhaps not 'wrong' but not being particularly helpful or perhaps is not up to speed with mortgage lending in this country (compared to my experience as a layman).
My partner and I have just had a mortgage offer confirmed on the basis that we will rent out her existing residential property. Her existing lender has granted 'Consent to Let' with no change to the existing mortgage terms and conditions.
I have also done the same previously (twice) and a combination of Consent to Let on my exiting property combined with a new residential loan for the new property is all the has been required.
I expect it all comes down to affordability - I have never really stretched myself and could have covered all payments on all properties myself if necessary. I have also had a seperate deposit on each occasion and have not needed to raise capital by remortgaging.
My partner and I have just had a mortgage offer confirmed on the basis that we will rent out her existing residential property. Her existing lender has granted 'Consent to Let' with no change to the existing mortgage terms and conditions.
I have also done the same previously (twice) and a combination of Consent to Let on my exiting property combined with a new residential loan for the new property is all the has been required.
I expect it all comes down to affordability - I have never really stretched myself and could have covered all payments on all properties myself if necessary. I have also had a seperate deposit on each occasion and have not needed to raise capital by remortgaging.
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