Can I have more than one mortgage?

May 10, 2023
Multiple mortgages

People often ask us whether it’s possible for them to hold more than just the one standard mortgage at the same time.

The short answer to that question is yes, it is definitely possible to have more than a single home loan at any one time. In fact, there’s no legal limit and it will depend on your personal circumstances plus the type of mortgages you’re after.

You may want additional home loans to purchase a holiday place, complete improvements on your current residence, or invest in a buy-to-let. If you wish to move house and can’t do so mortgage-free, you may be able to keep your existing home, either to rent out (in which case you’d have a buy-to-let mortgage) or for personal use.

However, you’ll need to bear in mind that not everyone will qualify for one mortgage, never mind multiple products. Equally, this situation isn’t without risk, or something to enter into lightly.

As you’d expect, many different factors come into play. And there are things you can do to boost your chances of applying successfully for two or more loans.

You’ll need to take a number of things into account, including your credit score, current debts, what you can afford and whether you have the time to manage a number of properties. Equally, are you able to justify your reasons for having multiple mortgages, and what is your attitude to risk?

Clearly, you’ll have to pass the lender’s criteria, including a credit check and an affordability assessment.

How many products can I have?

If you’re wondering ‘How many mortgages can I have?’ you’re not alone. In truth, there’s technically no limit on the number of loans you can take out at any one time, as long as you meet the criteria for having all of them.

Equally, you should have a compelling reason for holding multiple mortgages, since the cost of running these can quickly mount up. And, for example, while owning several properties makes little sense for most of us non-A-listers, having various homes as a buy-to-let landlord would.

What about having more than one residential loan?

You can take out over one residential mortgage, depending on income, but will still have to name a main residence. Although purchasing a second place is usually straightforward enough, that isn’t always the case beyond that. And, even for a second property, you’ll need to supply a sound reason for the purchase, either because you’re working away from your main base or want a holiday home.

With a residential mortgage, you can typically arrange a smaller deposit than is generally required for a buy-to-let loan. But lenders tend to restrict numbers of residential loans to avoid illegal sub-letting. If you want to rent out your home for a short time, you can apply for what is called Consent to Let.

You can take out over one residential mortgage, depending on income, but will still have to name a main residence. Although purchasing a second place is usually straightforward enough, that isn’t always the case beyond that. And, even for a second property, you’ll need to supply a sound reason for the purchase, either because you’re working away from your main base or want a holiday home.

With a residential mortgage, you can typically arrange a smaller deposit than is generally required for a buy-to-let loan. But lenders tend to restrict numbers of residential loans to avoid illegal sub-letting. If you want to rent out your home for a short time, you can apply for what is called Consent to Let.

Again, technically there’s no limit. But some lenders do restrict sums they will offer to any particular individual, in a bid to reduce risk – although you can still have several products across different lenders.

With these products, you’ll usually be assessed on rental rather than your employment income. Generally speaking, lenders will expect rental income to meet up to 145% of your mortgage.

If you’re investing in commercial property, similarly there’s no actual limit on how many loans you can hold. But you’ll still need to meet your lender’s minimum criteria, and will probably have to pay a 25% deposit, with 35% being the norm for additional mortgages.

Talk to us

At Mortgage Centre Online, we provide straightforward, upfront advice about property loans. We can help whether you’re a first-time buyer, releasing equity, moving house or anything else. Learn more – get in touch today.

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