Posted on 12 April 2013 by Nathan
Let to buy. Hi, we currently own a BTL property worth £120k with an o/s mortgage balance of £68k. We live in a house worth £300k & have an o/s mortgage of £38k. We have an income of £90k & have no other loans etc. we have see a property for £650k that we really like, a relative will give us a £150k gift (early inheritence, no tax liabilty) as a deposit. Can we use LTB in order to progress this purchase? Do the figures stack up? Thanks, Nathan.
Based on the initial infromation you've supplied here, then on the face of it I think this should be something you can do.
Using you existing property, subject to the rental income it is likely to generate, you can capital raise upto 75% of the value, which after settling the original £38,000 would release £187,000 to be added to the £150,000 being gifted by your relative. This would then leave you around £300,000 to raise as a new main residence mortgage, which with an income of £90,000 is a multiple of only just over 3 x.
Obviously we would need to know the fuller picture around your financial situation but it does look promising.
If you'd like to explore this further, then please let me know and I'll arrange to put you in touch with one of our consultants.
More than mortgages, talk to me about:
Financial Protection | Investments | Personal and Corporate Pensions | Home Insurance
General Insurance | Valuations | Conveyancing | Wills | Home finders
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.