Re-mortgage primary residence for overseas property

J

Jezzer

Guest
I am hoping to buy an overseas property.

In the country where I am buying it isn't partical to take out a mortgage.

Can I remortgage my main residence and use the interest paid on this to offset against the rental income from the property abroad.
 
Yes you can, depending on where the property is you can get a certain amount on your existing home. I know people who've done it through Property partners here, so it's pretty straight forward.
 
Re-mortgage of main residence is a typical route to financing of a first overseas property for small investors, however the banks will not advance the funds on a property in another country (by and large) since they have no legal grip on that property. So in essence it is you home that is at risk and not the overseas property.

Also, this kind of financing will not generally give you tax relief on rental income earned abroad. Speak to your accountant and get definitive advice relating to your own case.
 
Thanks for your reply auto320. Yes, I realise that re-mortgaging my main residence puts that property at risk rather than the overseas property.

The country where I am buying does not have any tax on rental income so I don't need to worry about tax abroad. I understand that I will have to pay tax on the income in the uk. What I need to find out is whether I can offset the mortgage interest from a re-mortgage on a primary residence.

Basically I can either pay for the overseas property with cash or use a re-mortgage on my primary residence. If I can't offset the interest payments against rental income then I'll use cash.
 
jezzer, a rule of thumb that was described to me by a specialist here (Ireland) in regards to getting credit or a new mortgage on an existing property, is that if you are going above 100k then you are taking a risk, up to that you have the power to repay without too much worry.
 
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