Who can I remortgage regulated tenancy with?

Who can I remortgage regulated tenancy with?

8:04 AM, 9th July 2021, About 3 weeks ago 1

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Hi, I am interested in buying a regulated tenancy property that has had the same tenant since 1975. I am looking to take out a Buy to Let with a much higher interest rate to do this.

However, what I would really need to know is if there are lenders out there that would entertain this idea when this mortgage deal runs out.

Would I be able to remortgage this new purchase further on down the line?

I want to go in with my eyes wide open.

Many thanks

Alex



Comments

by Ian Narbeth

12:37 PM, 9th July 2021, About 3 weeks ago

Hi Alex
I think it is unlikely you can re-mortgage. We have several "sitting tenants" and lenders aren't interested because it is impossible to be sure of getting vacant possession. I would be wary of taking out a loan unless the terms are fixed for a long time. Suppose you borrow on a 2 year fix at say 4.5% pa. At the end of two years the same lender says it's 9% pa plus a 2% arrangement fee. Unless you can re-finance with someone else or raise money elsewhere you are at the lender's mercy. I have known of lenders demanding the borrower pay a new arrangement fee immediately the fixed term ends, failing which they will sell the property over the borrower's head.


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