House move query

[Converse2020]

Hi,

I recall some discussions on here about not selling house etc to move but instead converting mortgage (or remortgaging) to to rent out existing home etc. I thought the term used (by Sarnie possibly) was rent to buy but I couldn't find the thread I read so figured I have got that wrong.

Essentially - current house almost mortgage free (could pay off tomorrow but holding some funds in current account as we were thinking of extension). Now seen a house for sale so debating moving.

Could sell ours - but chances are we would miss out etc on house we've seen by the time we market etc etc, so the rental option sounds promising on paper.

Thanks for any tips (if even just a key word search ! )

[Eddie Strohacker]

Let to buy is what you have in mind, perhaps?

[fat80b]

Converse2020 said:

Could sell ours - but chances are we would miss out etc on house we've seen by the time we market etc etc, so the rental option sounds promising on paper.

We did this - the term you are looking for is "let to buy". We ended up with a mortgage from Birmingham Midshires which I understand is one of the more common providers for a) people looking to do this specifically and b) first time landlords.

The advantage in our case was that by shuffling the paperwork, we could be "cash + mortgage" buyers of the new place without needing to sell a property and create a chain. This meant that we were then in a better competitive position from a buying perspective.

You could always agree the mortgages (1 for the current and 1 for the new place) and then get the offer accepted based on this position, then as time passes, change plan if your current place happens to sell in time.

[Sarnie]

Eddie Strohacker said:

Let to buy is what you have in mind, perhaps?

^ Correct........

[Converse2020]

Wow - thanks everyone for the quick replies. will go do some research with the correct term !

[Welshbeef]

When we did this we requested “permission to let” from the bank which worked

[Sarnie]

Welshbeef said:

When we did this we requested “permission to let” from the bank which worked

Won't work if you need funds out of the property to fund the onward purchase.............

[Welshbeef]

Sarnie said:

Welshbeef said:

When we did this we requested “permission to let” from the bank which worked

Won't work if you need funds out of the property to fund the onward purchase.............

That makes sense - each time we have don’t it it’s never been increased mortgage.

[Converse2020]

I have overpayments I can take back that would give me a over 20% deposit on the new place, so I could do that then possibly retain the existing mortgage (lender website seems to suggest that's an option if I were to let it out) and then just need a new mortgage on the new house purchase.

Downside I can see so far is I end up with much higher stamp duty to pay now, and become a landlord which is something I know little about, other than all I do read is that its more and more of a hassle. My quick calcs on revised mortgage payments and guide on local rent suggest it won't make much profit, if any allowing for headaches / empty periods etc...

Is there a good / simple guide or website anyone can recommend for double checking my calculations ?

On the plus side - would potentially be quicker and put us in a stronger position (house we are looking at is chain free) with our offer.

[Sarnie]

Converse2020 said:

I have overpayments I can take back that would give me a over 20% deposit on the new place, so I could do that then possibly retain the existing mortgage (lender website seems to suggest that's an option if I were to let it out) and then just need a new mortgage on the new house purchase.

Downside I can see so far is I end up with much higher stamp duty to pay now, and become a landlord which is something I know little about, other than all I do read is that its more and more of a hassle. My quick calcs on revised mortgage payments and guide on local rent suggest it won't make much profit, if any allowing for headaches / empty periods etc...

Is there a good / simple guide or website anyone can recommend for double checking my calculations ?

On the plus side - would potentially be quicker and put us in a stronger position (house we are looking at is chain free) with our offer.

Just take out what you need, secure new property, sell original property straight away................you'll pay the extra stamp duty but get it back when the original property sells.........your income will need to be able to cover both properties...........