remortgaging home to buy a business

Does anybody know are you allowed to remortgage your house to buy into a business?

It will depend on a lot of circumstances. It may not be a case of a remortgage but a business loan with the house as a guarantee. It will depend on the amount you owe on the house versus it's value. You perhaps will have to supply a business plan in relation to the business or if buying into a well established one that you have to produce figures.
The only way you will know for sure is to go and talk to your bank.

You should be able to but it depends on your bank.

If you have a low loan to value and you have the income to make the repayments, they may lend it to you.

If they do it's the best way to borrow the money as it will be far cheaper than any other form of lending.

Make sure that you get the loan separately identified as you can claim the interest in full against your trading profits. Do not claim interest relief at source on it.

Some will argue that you should not tie up your home with your business. But if you can use your home to get a loan very cheaply, I see no problem with that. If you borrow at a more expensive rate, you are more likely to fail and you will be giving personal guarantees anyway.

Brendan

What would the implications be if the house was remortgaged and put down as "home improvements" .. ie would this cause problems down the line if the business failed leaving the house with no equity left in it?

adviceplease said:

What would the implications be if the house was remortgaged and put down as "home improvements" .. ie would this cause problems down the line if the business failed leaving the house with no equity left in it?

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This is called 'fraud'.

Are you really, really sure that you want to put your home on the line for a business investment?

adviceplease said:

Does anybody know are you allowed to remortgage your house to buy into a business?

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Hi adviceplease,

In your other posts, you mention you actually want to sell your 50% of your current business. Are you thinking of actually buying out your partner's share, or insted investing in another business entirely?

A summary of the whole situation may be useful.

two reasons for a bank to decline application for further funding on a private home 1. tax liability 2. business investment, so if you say 'home improvements' and the mortgage application is approved, any problems down the line put your family home at risk, with the added problem of fibbing on the application form in the first place, neither bank nor judge will be sympathic if non payment becomes an issue due to business failure particularly if you said the money was for home improvements.