Second Mortgage - Is it possible

Discussion in 'Mortgages and buying and selling homes' started by LadyGil, Jun 15, 2017.

  1. LadyGil

    LadyGil New Member

    Posts:
    3
    Last edited: Jun 16, 2017
    Hello All
    I'm a first time poster hoping to get advise I am looking to get a second mortgage with my partner to build a house on his site. I have a mortgage already with a remaining balance of approx 178,000. I estimate that if my house went on the market it would probably be for approx 180,000 however I would like to keep it as I have teenage kids from a previous relationship so really it is their home or an investment for their future.

    Myself and partner combined salary is approx 86,000. My question is would a bank look at us as a joint application? Or should my partner seek to get the mortgage on his own.

    Thanks in advance.
     
    Last edited: Jun 16, 2017
  2. Chris2014

    Chris2014 Frequent Poster

    Posts:
    115
    The limit is 3.5 times your income so no.

    Kids will reduce that limit even further.

    I don't think it's realistic.

    Could you buy land and build 2 houses?
     
  3. LadyGil

    LadyGil New Member

    Posts:
    3
    Thanks Chris2014 for the reply. We have plenty of land to build on. Are you suggesting build two to sell one and pay off something off the house we build to live in? I'm not sure if that would be a runner with himself but worth a mention.

    Thanks .. For a mortgage of 200,000 what income would we need? I could also look at renting out mine which would more than cover mortgage on it.
     
  4. Chris2014

    Chris2014 Frequent Poster

    Posts:
    115
    If it was just himself he would need 200,000 / 3.5 = 58k

    Also the deposit would be 10% instead of 20% if it was a single mortgage as he would be a first time buyer.

    Could he borrow as much as he could and then get a Credit Union loan in your name to top it up? Might be another option.
     
  5. LadyGil

    LadyGil New Member

    Posts:
    3
    Thanks Chris for the reply/

    It is my salary that is above the 58k required not his so maybe we will just have resort to renting a property instead of building a home.
     
  6. listen

    listen Frequent Poster

    Posts:
    18
    Hi Lady it is possible. I have 3 mortgages. First I took out one on my mums which I needed to renovate for her in 2003. It was not a large mortgage. Second one I took out was in 2010 for my first home which I now have rented out. Then I got a 3rd in 2013 to buy my present home with my oh. The way it worked worked for us was the bank approved us for x amount based on our salaries. Then they deducted the amount due on the other 2 mortgages and that's what they gave us. We had a sizeable deposit also which just got us over the line. This was 4 years ago so things may have changed since.