This is a bit of a complicated one to explain:
Our house is currently on the market. We have seen somewhere else that we would like to buy. We are both self employed and do not yet have 2 years accounts on board. However in January we will and have been advised that we will be able to get a mortgage then. The place we are looking to buy is not likely to go anywhere in that time. Unfortunately it doesn't look as if ours is either. I am going to speak to EA about best way forward to get it sold but the market round here is dead (small rural market town).
The place we want to buy is very small (total internal space 50sqm and we have 4 kids but amazing location and 2 acres land). In an ideal world we would want to extend it asap. Currently by the time January comes around we should have saved enough for a 25% deposit without selling our house. If we sold our house we would release more capital which we could then put forward for a bigger mortgage to enable us to extend.
If we don't sell then we can still buy it but wouldn't be able to extend.
Anyway (sorry for long winded post) my question is: if we kept our current house and moved the mortgage to Buy to Let would this be counted against our borrowing potential long term? I.e.
Current mortgage 110k
New house price 150k
New mortgage required 110k
If we extended we would need another 100k (approx).
If we let our current property and the rent covers the mortgage (which it would) would this still be put into the equation on our borrowing potential?
Thanks for reading!
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1 reply
jenbird · 12/08/2012 22:48
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