Terry and Sophie wanted to move quickly, but did not want to loose money on their existing property. See how let to buy mortgages solved their problem.
Terry and Sophie were keen to move house as soon as possible. They had recently become grandparents to their daughter who lived 150 miles away in Cambridge. They were keen to move to be closer, but the market was still flat in their area and they were loath to accept the depressed price on their home. They knew in the long term they wanted to move back up to the North of the country, or at least to sell when the market had picked up again.
Their existing home had a small mortgage with around 10 years left to run, and there was around 14 years until they both wanted to retire. Both Terry and Sophie worked for the NHS and were able to take similar roles in hospitals close to the area they wished to work, and could raise the sort of mortgage they would need for a comfortable 3 bedroom semi close to their daughter and grandson. They knew prices were already rising fast in Cambridge and were worried that the time it took to sell in Leeds may cost tens of thousands of pounds. Added to their fears was the fact that in 5 to 10 years’ time, the cost of property in Leeds may have risen significantly and they would be penalised again should they decide to move back to the North Yorkshire countryside they loved and hoped to retire to.
The solution was to rent the existing property. They needed a significant deposit to purchase their new property, and were able to release 75% on a let to buy mortgage. Because the mortgage was calculated like a buy to let, based on the rental income of the property, it was considered to be self-funding and did not affect their borrowing power on the new residential. The new lender simply ignored this commitment because the rent was much greater than the interest only payment of the mortgage. They were left with a small profit of around £150 per month which they put away to cover wear and tear and redecoration down the line.
Talking to a mortgage broker might create far more opportunity than you might have realised. Remember we charge some of the lowest fees in the industry, and eager to pass on any of the knowledge we have learned over the past 10 years in the business. Call us on 0207 183 1101 to see how we can help you.
This case study was specific to this client and your situation and circumstances may be different. You should always seek advice specific to yourself.
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