Second Mortgage

[Sarah-Jayne]

Hi all,

We currently have a mortgage on a 2 bedroom flat. However, we have a mortgage for 75% and have to pay the 25% when we move out. Also, when we first got the mortgage we tied ourselves in for 5 years and currently have 2.5 years remaining on that.

The other day the OH found a house that we have fallen in love with. We dont really want to sell the flat as its prime location for the Suffolk College and Marina so thought about maybe renting it out and getting a second mortgage on this house.

Does anyone know how this sort of thing works? Do we have to convert our current mortgage to a 'buy to let mortgage'?

We are a little clueless when it comes to this sort of thing and I wondered if anyone on here had advice or tips?

Thanks x

 

[fillymum]

I don't have a clue but would advice you to ring any mortgage provider and ask them.

Good Luck.

 

[Jennyonaplate]

If you bought the flat under shared ownership then there are strict rules about renting, as the reason for the scheme is to enable people to get on the housing ladder, not make property investments.

I would check with the developer or Housing association that the flat was bought from before looking at second mortgages.

I also think that buy to let mortgages are different, as you need a bigger initial deposit, so it might be another spanner in the works to try and swap it over.

 

[Happy Holidays]

Contact your existing lender initially, as they will let you know if you can transfer your existing mortgage to a buy to let (B2L) without penalty. They will also let you know if you can have a 2nd mortgage on your new house and they will let you know how much they are prepared to let you borrow. With that info you can then contact other lenders and see who is prepared to offer you the best deal.

Or contact a financial adviser (you're better with a referal so ask friends for one) who may charge a fee but they will do all the leg work for your 2nd mortgage. They will sort out how much deposit you need, make sure the app is processed asap, notify you if additional info is needed, in fact they will do it all & it is well worth the fee they charge. A financial adviser will tell you on the first meeting how much they charge.

I do work in the financial services but we don't do mortgages that's how I know all the above.

Good luck