In I am considering moving house next August. I currently have a 90% mortgage (original house price 110k (100%)). My 3 year residential fixed rate mortgage comes to an end early next August.
At this point I want to buy another house for myself and my family to live in. I want to know how realistic it would be to hold onto my original property and let it out? What impact would doing this have on the purchase of the new house and implications on obtaining a mortgage on the new property.
Specifically:
- Is the scenario I describe a normal one?
- Would the buy-to-let mortgage I would obtain on the original property be self-financing, and therefore not impact on my residential mortgage application? i.e. the value of the property and rental income would be considered the security for the mortgage.
- I believe the original property has increased in value by between 20 and 40k, could this increase in value be used to obtain a more competitive buy-to-let mortgage (say 75-85%)
- Alternatively, could an increase in value of the original property be released to aid me in the purchase of my new residential property?
- Are there other pitfalls/benefits I should be taking into consideration before embarking on this? Big question I know!
PK