My house is valued at £154,000 and I owe £80,000 could I use £30,000 of the equity as deposit on another house and then let the first one?
Thank you for your enquiry. Raising £30,000 on your existing property will increase the loan to £110,000 and the loan to value (LTV) to 71.4% which should place you in a comfortable position to achieve this goal. Of course the rental income should be sufficient to cover the mortgage as well.
Selecting the right lenders for the purchase and re-mortgage is a scenario we encounter on a daily basis and our advisers can position both cases. As some banks will not allow capital raising for the deposit and others may not be comfortable woth affordability stretched on two properties, it is vital that you obtain professional advice.
If you'd like to explore your options in more detail, then please let me know and I'll arrange for one of our consultants to contact you.
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Answers provided in response to Ask the experts are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.
We recommend you seek professional advice with regard to any of these topics where appropriate.
YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY DEBT SECURED ON IT.
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