Raising capital on our Buy To Lets. How much can we borrow?

Posted on 10 February 2013 by David


Raising capital on our Buy To Lets. How much can we borrow?

My wife and I have two buy to let properties. The first is worth about £90k with a mortgage of £70k. The second is worth about £120k with a mortgage of £72k. We are looking at selling the property we live in to buy a large house. I would like to know if there is any way we can take the equity from our buy to let's and put it into the deposit for a new house. If this is possible roughly what would the fees be and would the mortgage payments on our buy to let's increase. Many Thanks David.

David,

On the first property the Loan To Value (LTV) is already almost 78% and most Buy To Let lenders cap their LTV's at 75%. Although their are a few lenders who goto 80% this would only represent an a small capital release of some £2,000 of which a fair proportion would be lost to fees. The second property offers more scope and if you were to increase the mortgage to 75% this would represent a capital raise of £18,000. If the rental income generated by the property was sufficient for the lender's criteria, then at 80%LTV this would give you a total capital raise of £24,000.

The fees for Buy To Let mortgages vary considerably from some fairly high percentage fees (3%) to low flat ones, and even some that are fee free. The rate that you are charged will also vary depending on the fee option, and part of our job is to look at the most cost effective rate / fee combination for your circumstances.

If you'd like to have an initial discussion about your options, then please let me know and I'll arrange a convenient time for one of our consultant to speak with you.

Regards,

Simon

simon.collins@johncharcol.co.uk

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