My lender won't let me raise capital on my existing house so I can move!
Posted on 14 January 2013 by Scott
I have a house which is valued at approximately £115,000 and an outstanding mortgage of £40,000. I am wanting to release around £20-30k equity from my current house and use this as a deposit to buy another house valued at £150k. We are hoping to live in the new house and rent out our current house. Is this possible as my bank have said that they won't allow me to release the equity if I am to use it as a deposit on another house? Also could I port my current mortgage across to the new house as the rate I have is +0.99% of base rate.
There really shouldn't be any reason why you can't release the equity you want to from your existing property, turn it into a Buy To Let, and move to a new main residence. Unfortunately there are lenders out there, who because of the exceptionally low rates that many borrowers are on, are looking to use lending policy as a lever to force such borrowers away from them.
Subject to meeting rental criteria it should be relatively straightforward to raise a Buy To Let mortgage for £70,000 (61%LTV) and you would then need to check with your current lender whether you can port your exitsing rate to the new property. If they won't allow it, then we look at the whole of the market to find the most suite alternative.
If you'd like to discuss your enquiry in more detail, then please let me know and I'll arrange for one of our consultants to contact you.
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.
YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY DEBT SECURED ON IT.
John Charcol is a trading name of John Charcol Limited and its Appointed Representatives. John Charcol Limited is authorised and regulated by the Financial Conduct Authority. The Financial Services Register number is 665649. Registered in England No. 9157892. Registered office address for John Charcol Limited is 5th Floor, Cutlers Exchange, 123 Houndsditch, London, EC3A 7BU. The FCA does not regulate some investment mortgage contracts. Calls may be recorded for training and monitoring.