7:40 AM, 2nd August 2019, About 2 years ago 42
I am a 65 year old single female, no children and my only incomes are state pension, carers allowance and rental income from my former home in London. The property is worth around £1.3 million and rents for £3,000 a month. I now live with my Mother in the North East as her long term carer. The arrangement works well for us both.
I have a £300,000 mortgage secured against the London property, which comes to the end of its interest only term next year. I don’t think I could remortgage due to my age, credit status and my income position. In recent years I’ve spent a lot of money on the London property, which has kept my tax bill right down, but it has left me very short of cash and with very little profit to show to lenders to enable me to secure another mortgage. To cut a long story short, I made the mistake a few years ago of renting to a person who turned out to be a tenant from hell. I trusted my instincts instead of having them professionally referenced – never again! My savings are all but depleted as a result of that naive mistake and I cannot afford to make another, hence this post.
What I need most is more income, but replenishing my financial reserves would be good too.
Until I read the article yesterday about Lifetime BTL mortgages I thought my only option was to sell up. Whilst that would produce a large amount of capital it would also leave me with no income other than my state pension and carers allowance, the latter of which will not go on forever sadly. I would also have a huge CGT bill to pay given that I have been letting the house for 12 years and I only lived there for just over a year before I moved in to help my Mother.
I have reconciled myself to the reality that I will never be able to afford to live in my London property again.
The Lifetime BTL mortgage option appears to solve several problems for me. I could pay off my existing mortgage, retain my rental income, make no further monthly mortgage payments and never have to worry about money again.
I have already obtained a quote and I do qualify for this Lifetime BTL mortgage subject to valuation. If the value comes out at £1.3 million I can raise enough to pay off the existing mortgage and have an additional £77,000 left over. The lenders maximum LTV is 29% for my age.
I’m quite keen on this but felt I should put my thoughts into writing and ask the Property118 community to comment.
What would you do if you were me?
Anonymous RetireeShow Form to get a Lifetime BTL Mortgage Quote
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