How do I get my next mortgage?

[whatbeshrekking]

I bought my flat through Right To Buy 18 months ago, and received £10500 discount on the value, therefore needed no deposit for the mortgage.

The terms are that I can sell after 3 years, or sell earlier and pay back 1/3 of the discount for each year that I'm early. I've currently paid about £3500 of the mortgage, and put in a new bathroom at about £3500. I am tempted to cut my losses in 6 months and start to look at moving, therefore obviously taking a £3.5k hit.

Regardless of that, question is, do I have to physically sell this place and move out to free up the equity before I can start looking at a mortgage for the next place, in order to have the deposit sitting in my back?

Or does my next mortgage lender take into account the equity as deposit towards my move?

Hope this makes sense!

The equity is taken into account. You apply for the amount you need taking into account how much equity you expect to have - say the new place is on at £250k and your equity is £15k you apply for mortgage of £235k. Get an agreement in principle to show you can get a mortgage of that amount when you make an offer.

When you sell and buy simultaneously you don't usually need the deposit monies upfront. Instead they pass up the chain on paper. Only the person at the bottom actually has to have the deposit ready before exchange.

Thank you @wowfudge! That's what I hoped