Ask an expert

Can I remortgage to raise funds for property development and to start my own business?

January, 30th 2015
Q: I have an interest only mortgage and owe £213,000.00 with equity of £100,000.00. I would like to remortgage with an additional loan of £70,000.00 for property development and to start a business. What can you do?
A: On the presumption you have an interest only mortgage for £213,000 on your main residence, which is currently valued at £313,000 i.e. with equity of £100,000, then there may be finance options available to you. Your intention to use the proposed funds for property development and to start a business would be acceptable to some lenders – However, you should be mindful that if you are starting a new business which will be your main employment, then lenders will require you to have been running that business for at least one year, and provide the first year SA302 before taking income in to account for the purpose of servicing mortgage repayments. It may be viewed that current earned income will seize as your time will be dedicated to the new venture – So that we can fully understand your circumstances this would need to be discussed in more detail with one of our qualified and regulated advisers. Another point in case, is that interest only mortgages are not generally available beyond a certain loan to value ratio without being able to liquidate an unrelated asset as an exit strategy for the loan. So, if you were to remortgage to another lender then interest only may not be available, dependent on your other assets. If this is the case, and you wished to keep your existing mortgage on an interest only basis, we could look at potentially raising the additional funds required by arranging a second charge facility. I trust this answers your questions, and I would welcome the opportunity to discuss your options in more detail over the telephone.


These questions are for information purposes only and do not contain all the details you need to choose a mortgage, ask one of our advisers for a personalised key facts illustration
  • This Month's Top Fixed Rate

    Fixed rate
    Initial rate: 1.09%

    Period: 2 Year

    Rate will revert to the lender's standard variable rate currently 4.49%
    The overall cost for comparison is 3.99% APR

    1.09%

    More info
  • This Month's Top Variable Rate

    Variable rate
    Initial rate: 1.07%

    Period: 2 years

    Rate will revert to the lender's standard variable rate currently 5.34%
    The overall cost for comparison is 4.71%

    1.07%

    More info

    Get This Rate


Some of this month's top interest rates are listed above; the actual rate will depend on your circumstances. Please note that this information does not contain all the details you need to choose a mortgage, ask one of our advisers for a personalised key facts illustration on 020 7519 4900. The rate displayed may become out of date at short notice.

LML BROCHURE

Download our brochure to find out more about Largemortgageloans.com and what we can offer

Click to Download

Rate Alert

Client Testimonials

"My Mortgage Manager was very responsive. We never had any issues, it was a...
READ MORE

CC, CC

“My Mortgage Manager and Administrator were great, I have emailed them personally to...
READ MORE

AK, AK

“My Mortgage Manager helped me overcome a lot of barriers. My Mortgage Manager and...
READ MORE

ZJG, ZJG

"I purely came back to you because of the service from my Mortgage Manager. My...
READ MORE

PW, PW

Logo
STAY CONNECTED WITH US:
  • Facebook
  • Twitter
  • Linkedin

London Office

Tel: 020 7519 4900
Fax: 020 7519 4910
Email: info@largemortgageloans.com

Guernsey Office

Tel: 01481 234527
Fax: 020 7519 4910
Email: info@largemortgageloans.com

YOUR HOME OR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT
Changes in the exchange rate may increase the sterling equivalent of your debt

Largemortgageloans.com is a trading name of Largemortgageloans.com Ltd, 12 Pepper Street, London, E14 9RP which is authorised and regulated by the Financial Conduct Authority. We are entered on the Financial Services Register No 302228 which can be viewed here: www.fca.org.uk/register/. The Financial Conduct Authority does not regulate some aspects of buy to let mortgages, overseas mortgages and tax advice. Help and advice in regards to mortgages is available at www.moneyadviceservice.org.uk

Largemortgageloans.com Limited is registered with the Guernsey Financial Services Commission, reference number: 2269418, as a Non-Regulated Financial Services Business.

A typical fee of 1.17% of the mortgage amount is payable. Of this, 20% is payable on application and the balance of 80% on completion. For example on a mortgage application of £300,000 the fee would be £3,510 in total. Of this, £702 (20%) would be payable on application and the balance of £2,808 (80%) on completion. The total fee is non refundable. We may also be paid commission from the lender. The guidance and/or advice contained within the website is subject to the UK regulatory regime and is therefore primarily targeted at customers in the UK. Calls may be recorded for training and monitoring.
You may have to pay an early repayment charge to your existing lender if you remortgage.

Largemortgageloans.com Ltd Registered in England and Wales No: 5070990 Registered Address: Bridge House, London Bridge, London, SE1 9QR. 2005-2017. All rights reserved.