Whether you’re looking to venture into the world of buy-to-let or you’d like to purchase a holiday home, you may be wondering if you can have two mortgages at the same time.
The short answer is ‘yes’. You can have two mortgages at once, providing you meet a lender’s criteria and can prove your ability to afford both loans.
You’ll need to prove you’re able to afford both mortgages
When applying for a second mortgage, you’ll need to prove to lenders that you’re able to manage your new mortgage repayments as well as your existing ones. Lenders have a responsibility to ensure that they aren’t getting borrowers into more debt than they can afford to repay, so they’re likely to conduct a series of checks to ensure loan repayments will be affordable.
Have bank statements, payslips and invoices at the ready. Your lender will want to see exactly how much money you have coming in each month and they may even wish to learn how much you spend on average.
Your lender will want to ensure you’re credit worthy
Not only will lenders want to check that you can afford the loan, they’ll also want reassurance that you’ll actually repay it. For this reason, they’ll take a close look at your credit history to see what your debt repayment track record is. If you’ve always paid your existing mortgage on time and manage other debts sensibly, you’re likely to be looked at more favourably than if you had trouble keeping on top of your loan repayments.
Consider whether you’ll still be able to afford both mortgages if your financial circumstances change
When applying for a mortgage, or indeed, a second mortgage, it’s important to consider whether you’ll still be able to make your mortgage repayments if your financial circumstances change.
If you were to lose your job or face a large unexpected expense, would this cause financial uncertainty? It’s wise to have a strong emergency fund at your side so that if the worst was to happen, you could manage your essential living costs without having to take out further debts.
A broker can help you find the right lender for you
Each lender has a set of criteria that applicants must meet before they are approved for a loan. Without getting in touch with each lender and going through their application process, it’s really difficult to determine what their criteria is.
This is where a mortgage broker can come in useful. They’ll know each mortgage provider like the back of their hand and will have an idea which lenders are most likely to approve your application based on your financial situation.
Your broker will save you jumping from lender to lender while preventing you from destroying your credit rating in the process.
To learn more about getting a second mortgage, please get in touch with the team at TaylorMade Finance.
