Can a new buy to let mortgage application jeopardise an existing mortgage offer?

[ALbigbump]

Hi, we are currently living in a caravan waiting to buy our home but the seller can’t find anything and refuses to rent. It’s our dream home so we’re prepared to wait, our mortgage offer is valid for 5 months. I’m really worried about the impact of having no fixed abode and have seen something much smaller which would be ideal while we are waiting, could maybe let if the one we want becomes available. Does anyone know if we applied for another mortgage while our offer is valid, whether it would affect our existing mortgage offer? Many thanks

It wouldn’t be a good idea. You can’t take out a BTL mortgage if you plan to live in the property. You’ll also pay SDLT on your second purchase at a much higher second property rate and without any first time buyer rate. And if you’ve used your deposit money to buy the first place, how are you going to buy the second? If your current mortgage offer is only valid for five months and your seller hasn’t even found anywhere yet, it’s highly likely that your offer will expire and need to be renewed before you complete on your house purchase, at which point they’d discover you already had a mortgage and decline you another if they deemed you unable to afford both.

Simply applying for another mortgage doesn’t affect the offer you already have, as you’ve not taken out the mortgage yet; but the logistics after that aren’t quite as simple.

Thanks both. If we buy the BTL first, would we have to pay the higher stamp duty on the one we want to live in?

Also if the purchase of our dream home started to progress soon we’d keep the other as a buy to let. I’m just worried about having no address at the mo, esp as our son is in year 6 and we are looking at high schools 😬

You’d pay the higher rate of stamp duty on the second property you bought, yes.

Very few lenders will give you a BTL mortgage unless you already own a home you live in. If you want to live there whilst you’re waiting then you’d need a residential mortgage. And then if your mortgage offer for the “dream home” expires before you complete, or the lender credit checks you before releasing funds (which does happen) you’d be stuck unless you’re in a financial position to qualify for two residential mortgages.

Plenty of people live in temporary or rented accommodation when they’re applying for school places, check with your local authority what evidence you need to provide that it’s your main home for the time being.