any advice?

[redcrx]

I have a flat which has been on and off the market for 2 years with no success. I have an asking price offer on the table which was made 4 months ago but the purchaser hasnt managed to sell theirs either and so Im getting a bit disheartened. My estate agents have admitted they are struggling, not with the price or the flat itself but with its location above a restaurant. It is �15 less than anything else in the town. My partner owns a property elsewhere and this is just big enough for us and our child but with another on the way we are now having to move. We are restricted as to what and where we can by due to his job and as such would need to sell both properties and then take out a further �100k mortgage to move on. Our bank has agreed in theory to this but of course we cannot proceed with the house sale until the flat is sold and time is running short. Do you think i could re-mortgage my flat on a buy-to-let and still be able to take out a joint mortgage without having to consider the flat mortgage? Im pretty sure the flat would easy rent out.

[Oneeyedvic]

If you can rent out the flat at 130% of the mortgage payments then there will not be a problem securing personal mortgage (a lender will pretty much ignore your btl).

If the rental income is below that, then you may have an issue.

[redcrx]

well with the way the mortgage is at the moment i could charge 200% of mortgage payments for the rent at least. So I may even have a chance of releasing some of the equity in the flat for a deposit on a new house?

Thank you OEV I may just give the agents a call now :)

[frankief]

Get back to the original bidder and offer him a discount. Just sell and get it off your hands. There are loads of apartments on the market, and there are going to be loads more 'buy to let' horror stories in the next 12 months. Don't re-mortgage, you are just increasing your exposure to debt.

[redcrx]

frankie, the bidder wont even be able to buy mine at 50% unless he sells his will he???

[Twenty20]

Yes, you could remortgage the flat and use the money towards another house. There will be tax implications on the flat when you do an annual return i.e. the interest on the mortgage payments wont be allowable against your tax bill, so you might find yourself paying more tax.

Although it sounds like you might get a good yield on renting the flat, do allow for voids (periods in between tenants when you wont get any rent) plus other costs, repairs etc. And, if you use an agent they'll take a cut too.

[anniebird]

If a Mortgage is taken out on a property for letting the interest will be allowed against tax. Also an allowance for maintenance of the flat.

[Twenty20]

If you remortgage one property but use the money to purchase a second then the interest isn't tax deductible.

[anniebird]

As long as the money is used for the rented property it is allowed no matter which property it is secured against.