Remortgages

king_of_inismac

Hi,

we own an apartment with the about 200k worth of equity, but with 10 years more of payments due on it.

ideally we would like to keep our apartment and buy a house, using the apartment for rental income long term.

just wondering how banks deal with this sort of situation? How would it affect our deposit requirements and would our equity be of any value?

our combined salaries are good, so its really about deposit requirements.

thanks,

king

Q&A

Low mortgage repayments and a low LTV should mean a bank would be willing to consider your existing loan as a BTL. However, I don't think they'll let you release equity for another purchase at the same time.

You'll likely need to have 20% (10% from January) of the purchase price independent of your apartment.

Something else to consider is the cost of being a landlord. Lots of horror stories and about tenants over holding because there is nowhere for them to go and how current government policy is anti landlord. It might not be with the headache for you.

walterking

Currently any "profit" on the sale is tax free.

Once you start renting it, that "profit" is taxable gradually over a number of years.

Then all rental income is taxed. You also have rtb registration and then possibility of poor tenant.

It's really not worth it to rent a single property these days.

Sell it, then have a low LTV mortgage which gets you a lower interest rate and avoid the hassles of renting