Combining Two Mortgages

[PasDevantLesElephants]

I know that ultimately we need to talk to our existing/new mortgage lenders to understand what's possible but wondered if anyone had experience/advice while well mull over our plans.

We have one cottage worth about £210k with a mortgage of about £150k. A few years ago we were able to buy the cottage next door to our worth about £190k. It needed a lot of work and we remortgaged it on buy-to-let mortgage for about £30k to pay for the work.

The second cottage is currently rented out, but in a couple of years (as the mortgage deal on our main house ends) we'd like to knock them together. Will it be possible to arrange a new loan which against both properties which incorporates both outstanding mortgages balances (total of £180k). We'd be look my to combine the deeds to a single title which should make things easier. It's just we'd need it all to happen at once if you see what I mean.

Happy to hear any thoughts about how possible it would be any anything I might have overlooked!

It's just me presuming but I would imagine that once the two cottages are one entity legally, it should be pretty straightforward converting the BTL mortgage to a residential one. For valuation purposes, it could be regarded as a house with an annexe or sth. The physical knocking through of the two properties could take place after that.

Have you spoken to the planning department in you local council? You may need planning permission and some councils are reluctant to see a reduction in the number of dwellings in their area.

You need to be very careful here. Each mortgage is on one property only. You will not be allowed to continue either mortgage if you get new deeds, particularly since the value of one combined property is likely to be less than two individual ones. Keep you mortgage providers informed but be prepared to have to close your existing mortgages and apply for one completely new one.

Thanks @JoJoSM2, the house with an annex thing makes a lot of sense.

@Needmoresleep Yep, spoken to planning. No external changes so they're not bothered. If we ever wanted to divide it up again is another issue....!

@Grumpyoldpersonwithcats you're right, we're not going to do anything until our existing mortgage deal ends so we're free to shop around for someone accommodating! I know what you mean re: the total value but as the mortgage on the BTL is quite small, I hope we should still be able to increase our LTV by combing houses and mortgages.

I think I need to speak to a mortgage advisor!