I own one property outright. How can I go about using the equity in the first property to buy another?

I live in the UK and own one property outright. What is the best way to go about using this equity to purchase another property of a similar value, for rental purposes?

Best Answer:

Nathaniel 2008: UK: Depends on what you are going to do with one of the properties…
Eg, the one you own are you going to rent it out? If so you need a let to buy mortgage or if you are buying another to rent it out you need a buy to let mortgage or you go and see your bank and ask for an equity loan

Personally I would go and speak to an independent mortgage broker where you can explain your needs and they will advise what is best for you, they also have access to far more loans and at better prices than the public do directly…and if you don't use them you have the advice and it doesn't cost you, if you do, you pay a broker fee

Other answer:

Nathaniel 2008:
get a cash-out mortgage on your property
If the mortgage loan you take on the owned property will be enough to pay cash for what you want to buy, there should be no problem in doing that, as long as you meet any lender requirements for occupancy of the mortgage property. If you intend to live in the house you now own, and rent the one bought with cash, there should be no problem. If you want to live on the new property and rent the mortgage one, many lenders will not allow that.

If the cash you take out of your existing property is not sufficient to pay full purchase costs of the new one, you will have a difficult time finding a lender who will let you have two mortgaged properties.

you mortgage the paid property to buy the second one
Take a mortgage out on the first property. The interest will be much cheaper than
an equity loan. You will also be able to deduct it on your tax return.
You can get either gen an equity loan on the property you own to fund a down payment on house number 2 or get a larger one to pay for the whole price.
Pascal the Gambler:
A mortgage.
Mortgage it – Take out a loan from the equity.
The Oracle of Omigod:
Take out a first mortgage.
Mary Contrary:
Talk to a mortgage lender. Be prepared with your statement of profit and loss on the owned property.

One thought on “I own one property outright. How can I go about using the equity in the first property to buy another?

  1. 17/01/2011 – 9:34pmYo alucino con lo de Morata. Lo poco que le hemos visto ha sido excelente y no hay forma que le den su optournidad como en su dia se le diò a Raùl. En vez de lloriquear por un nueve, mientras se decide si se ficha o no, vete dàndole minutos al chavalin de la cantera. Si te sale bien te ahorras un fichaje y si te sale mal, por lo menos lo has intentado.

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