Can we raise funds on mum's house to help us buy in London?

Posted on 4 July 2013 by Josh

My mother owns a small 3 bed house in South Wales outright and we are looking to see if it is possible to keep this property as an asset and rent it out and then release some equity from it to secure a mortgage for a small place in London. The deeds are in my mothers name and the property is valued at around £110K. It is my brother and I who are looking to get the mortgage for the place in London and we are both first time buyers. Is this a viable option and/or what do you suggest the best type of mortgage would be? As the deeds for the house in Wales are in my mothers name, would this mean that she would also need to be on the mortgage? Many thanks for your help. Regards, Josh


You are correct that if you are looking to capital raise on your mothers property, then unless she sells it to you, she would need to be a party to the mortgage. We can then ceratinly look at a new main residence mortgage for you and your brother. If you are looking to rent out the property in South Wales, then the mortgage would need to be a Buy To Let one. Buy to Let mortgages are typically capped at 75% of the property value (there are a few that go slightly higher), and are also based primarily on the rental income likley to be generated.

The actual mortgage we would recommend to you for your purchase in London, would be dependent on your individual circumstances and future aspirations, which we would need to know before going much further.

If you'd like to let me know what the best time would be for you, then I'll arrange for one of our consultants to go through your options in more detail.



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