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2 houses new mortgages needed

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  • 2 houses new mortgages needed

    Hi there
    My husband has a house in his name valued 100k with mortgage of 65k left on it, I also have a house valued 100k with 100k mortgage left on it (thanks to house prices dropping).
    My husbands house is currently being rented out for £550 per month but is still on a residential mortgage and not buy to let, neither house is tied in to a fixed term so no early repayment charges.
    1. Is it possible to borrow 10k out of my husbands house leaving 25% equity in it and get a 75k buy to let mortgage in both our names on it and then use the 10k to put 10% equity in my house enabling us to get a 90k residential remortgage in both our names.
    2. neither of us are on a fantastic income (jointly 34k + 6k bonus) so would the rental income be taken into consideration and if so is there a maximum we can borrow against the amount of rent we can expect to receive.
    3. Is it better to take both mortgages out with the same lender and do the process for both houses at the same time or remortgage my husbands house, take the 10k then remortgage my house seperately.
    4. Excuse me here for being naive but are we correct that if we had for example a 100k mortgage over 20 years that in 5 years time we would owe 75k or does all the interest get paid off first before the capital as our goal is in 5 years time to sell both houses and have a nice deposit for a home we can buy together.
    We appreciate any advice that you can offer so many thanks in advance.

  • #2
    Re: 2 houses new mortgages needed

    bump ...........


    • #3
      Re: 2 houses new mortgages needed

      1). Possible - BUT bear in mind the interest rates on a 90% LTV may be extremely high, possibly even higher than what you are paying right now.

      2) Rental income generally is not taken into account (I assume you are talking about income requirements for your residential mortgage). However, for £90k borrowing, £34k should be ok (as long as you can prove income).

      3) Not necessarily. You may not get the best deals for you going with the same lender.

      4) No, doesn't work like that. I can't tell you exactly how much will be outstanding in 5yrs as it can vary from lender to lender. You will get a break down of the repayment structure with any quote and can work it from there.

      Without knowing your full details/circumstances, the above should only be considered as general advice, rather than specific advice for your personal case.

      Hope that helps a little.
      Ailan - ALQ Mortgage Consultancy
      Best Mortgage Rates