Getting a new new mortgage or a larger one?

[wanda]

I was thinking in the future when my family grows we would need to get a bigger place. Instead of selling and buying a new place I was thinking of the option of renting the current place and getting a new one.

How will banks look at this option will they want an additional deposit?

If anyone knows something about this could you kindly give me some advice.

Thanks.

[davelowe]

Do you mean to say you will be letting the current property and buying another? If so, if there is an outstanding mortgage, you may incur a higher interest repayments on the let property (you should inform the mortgage company what you are up to). If there is no mortgage outstanding, then you can offer the value of the property as collateral (within limits) - basically a deposit, but it may be subject to conditions of no sale (or the bank will have a notice of interest in it).

Letting a property is - well a bit like buying a second hand Renault - its only as good as the person who uses it. Get good tenants with references and a guarantor and aim for a long term let.

I can send you a sample contract if you are interested.

[wanda]

Thanks, that would help.