Is it worth me getting a mortgage? And would I get the tax benefit in this scenario?

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    #16
    Originally posted by BTL investor View Post
    With regards to the lenders taking into account that you have savings that could pay off the mortgage you have to remember that they have no idea who you are and what may happen in your life. Say for example a dodgy builder swindles you out of your money or you meet a woman that you fall head over heels in love with and she gets you to spend it all on exotic holidays and expensive jewellery or you marry her and then she divorces you and gets half your money.
    True but to be fair, you could equivalently say that someone might lose or quit their job. I personally can't see how having a job is more secure than having enough savings to live off for a decade without working.

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      #17
      Originally posted by jpkeates View Post
      They'll want to know where the money came from to go into those accounts.
      Well the majority of it is from saving my income for many years. So would my SA032s and tax overviews be proof? How can I prove where every penny that I have came from?

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        #18
        OP, reading your posts I would FORGET BTL. Get a pension (may be a SIPP). You can get tax relief on 40K/annum much better investment (which is why chancellors have chipped away at it over the years and STILL have their eyes on it).

        BTL these days is a minefield and will only get worse. You are young with better options!

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          #19
          Originally posted by mlod42
          True but to be fair, you could equivalently say that someone might lose or quit their job
          I tend to think the same when mortgage lenders will not take into account passive income. It doesn't rely on having a job, which I would argue is a definite benefit.
          There is a fine line between irony and stupidity. If I say something absurd please assume that I am being facetious.

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            #20
            Originally posted by John Duff View Post
            OP, reading your posts I would FORGET BTL. Get a pension (may be a SIPP). You can get tax relief on 40K/annum much better investment (which is why chancellors have chipped away at it over the years and STILL have their eyes on it).

            BTL these days is a minefield and will only get worse. You are young with better options!
            Thanks but as I'm only 25, I don't think I'll consider a pension at the moment. My current thinking is that I can already afford a house from my savings and as I'll only have to pay for bills and food, I can continue to grow my savings. If I end up being single forever, I think I'll be able to live easily without working well before retirement age and if I'm lucky enough to start a family, I would like my work now to be able to help with that. Furthermore, it feels terrible to think about this now but at some point (hopefully not any time soon!) I stand to inherit a lot from my parents so I cannot see myself having financial problems by the time I am at pension age.

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              #21
              Originally posted by doobrey View Post
              I tend to think the same when mortgage lenders will not take into account passive income. It doesn't rely on having a job, which I would argue is a definite benefit.
              Yeah exactly. It seems as though savings are not thought about much as most people don't really have them. It always shocks me that most people happen to spend as much as they earn!

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                #22
                doobrey Yes through a broker, one residential equity release mortgage and one btl equity release mortgage with different lenders. Maybe your circumstances are different to mine, I am employed full time so maybe that helps but I had no issues what so ever with being allowed to release the money it was just the hassle of having to prove how I came to own them outright. I would suggest you make a phone call to one of the big national mortgage broker companies with access to lots of lenders and experience with all sorts of mortgages and different situations to see if they can help, if they can’t just try another one until you find somebody that can help.

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                  #23
                  Thanks, I'll bear that in mind. Maybe make some enquiries. I bought my residential property outright 'by accident' because intended mortgage provider said 'no' at a point where I was kind of committed. I thought I would just remortgage after six months but then found it wasn't that easy.
                  There is a fine line between irony and stupidity. If I say something absurd please assume that I am being facetious.

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                    #24
                    Originally posted by mlod42 View Post
                    I feel that it's one of those things where no one's thought of it.
                    Trust me, it's been thought through a lot over and over.
                    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

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                      #25
                      Originally posted by doobrey View Post
                      Thanks, I'll bear that in mind. Maybe make some enquiries. I bought my residential property outright 'by accident' because intended mortgage provider said 'no' at a point where I was kind of committed. I thought I would just remortgage after six months but then found it wasn't that easy.
                      That's crazy. I really can't see why it should be so hard to get a mortgage after the purchase - we live in a crazy world.

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                        #26
                        Originally posted by jpkeates View Post
                        Trust me, it's been thought through a lot over and over.
                        Can you provide a source which confirms this?

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                          #27
                          Help to Buy Mortgages are only available if you are buying a newly built property or acquiring a shared ownership in conjunction with a Housing Society. It does NOT accommodate buying a second hand property for either personal occupation or renting.
                          Given that you have cash available you are indeed in a strong position to negotiate a good discount off of the sales price, in the current market cash is king and a motivated seller will be assured that the sale will not be hindered by you obtaining a mortgage.
                          Being Self Employed is indeed currently proving a challenge in procuring finance and there is an inclination now to take an average of the last three years net income but supported by close examination of your last three months bank statements both personal and business.
                          If you remain uncertain then keep your money in the bank accounts and look after your parents . At times like this it is payback time so far as your parents are concerned,

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                            #28
                            loanarranger OP is talking about a help to buy ISA which apparently can be used for any house in the U.K up to a certain value for first time buyers.
                            I hadn’t heard of them until I googled them after OP posted. I think this is different to the help to buy mortgages that are only available on new houses.
                            If I was OP I think I would take advantage of the ISA and buy a residential home with a 25yr mortgage and put down enough of a deposit to make the monthly payments manageable rather than paying out rental money each month and then look to invest the remainder of his savings in to 75% LTV BTL mortgages over the next 5 years whilst the economy is picking up and he gains experience as a landlord.

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                              #29
                              BTL Investor, you are indeed correct , the government sponsored scheme is designed to boost the savings to fund the deposit on any property in the U.K. with a concession on the price of properties located in London,You can use a Help to Buy ISA with any mortgage; you’re not restricted to a Help to Buy mortgage . Reading the OP I believe he was frustrated that having had the foresight to invest in this scheme he was precluded from taking advantage of it if he were to buy a property for cash.

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                                #30
                                Originally posted by loanarranger View Post
                                Help to Buy Mortgages are only available if you are buying a newly built property or acquiring a shared ownership in conjunction with a Housing Society. It does NOT accommodate buying a second hand property for either personal occupation or renting.
                                Given that you have cash available you are indeed in a strong position to negotiate a good discount off of the sales price, in the current market cash is king and a motivated seller will be assured that the sale will not be hindered by you obtaining a mortgage.
                                Being Self Employed is indeed currently proving a challenge in procuring finance and there is an inclination now to take an average of the last three years net income but supported by close examination of your last three months bank statements both personal and business.
                                If you remain uncertain then keep your money in the bank accounts and look after your parents . At times like this it is payback time so far as your parents are concerned,
                                I personally find it very frustrating as I did get a mortgage offer last year but ended up not going ahead with the purchase due to structural problems with the house. Given that I would have a mortgage now if I had gone ahead with that purchase, it is a shame that I might not be accepted again now.

                                I can't see how I'd be looking after my parents tbh as they would think it's too risky for me to even go to a shop if I live with them.

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