Breaking the chain using current house as equity?

[Propertyshmoperty]

So I'm guessing the answer is probably no but since my own chain has fallen through twice in the last year I thought I'd ask you wise mumsnetters if this is a "thing"

I also realise this is a massive "first world problem" and I am incredibly lucky to have a mortgage free home, thanks to buying in 2012 and a small inheritance that paid off the small mortgage we had left a couple of years ago.

I know its possible to use the equity in your current home for a buy to let property, but is it possible to do it for your next home?

Basically I have a house thats worth £375k with no mortgage. Is there anyway to release the equity to use as a deposit for the next? The max we can borrow is £350k I also have about £80k in savings, Isas and tracker funds. Houses I'm looking at buying are about £600k.

Just weighing up options as after 60+ viewings and 2 chain collapses if there's anyway I can break the chain and sell my house after I move out of it I'll bite a mortgage lenders hand off...

I think you're describing a bridging loan.

Yes they exist. You get one to buy a house you want and use your current house as collateral. Once your current house is sold you pay it back. They usually have massive interest so best used short term.

Bridging loans have sky high setup fees.

It would probably be cheaper for you to rent a good quality house on a six month lease and only use it for a month than pay bridging loan arrangement fees.

Thanks both yes I think I've heard of bridging loans, and agree it would probably be cheaper to rent. I think its because I've seen a house I like and just hope it doesn't get snapped up before I'm proceedable.

If you release the equity, you will need to have loan repayments on that mortgage. Won't that reduce the amount of mortgage you can (temporarily) have on the new house?

If you can afford it, you can get an mortgage on your existing house and use those funds as part of the deposit on your new house. We've just done this but it has been mega stressful paying two mortgages whilst interests rates are on the rise and the housing market is stagnant!