Posted on 9 February 2010 by george
Hi, I own a flat (Let at £1000 per month) worth £250,000 which has £98,000 left on a variable rate mortgage, the mortgage payments are £800 per month, me and my partner who are living with my parents, would like to purchase a house to live in worth approximately £330,000, we were wondering if we can pull £150,000 equity out of the flat to use as a deposit on the house, we have £12,000 cash saved up, our combined salarys are £55,000 a year, we are both new to this as the flat was left to me, any advice you can offer about the best way to go about doing all this would be really appreciated. cheers
There are several possibilities open to you for raising funds on your existing flat, your existing lender may consider a further advance, you may remortgage to a new lender or you may obtain a secured loan. However, none of these will allow you to release as much as you want.
Since the credit crunch the maximum loan lenders will consider as a percentage of the property's value (LTV) has reduced and there are very few offers available above 75% LTV. This would allow you to release around £90,000.
However, by selecting the right mortgage product on your flat and the right lender for your residential mortgage I think you may still be able to look at the property you have in mind and I recommend that you speak to an independent mortgage adviser as soon as possible.
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