How to remortgage to buy another property
If you’d like to buy a second home or invest in buy-to-let, you may be able to remortgage your existing home to buy another property. Let’s take a look at how to get a second mortgage to buy another house.
Can I get a second mortgage to buy another house?
Yes, you can often remortgage your home to buy another property. This involves releasing equity from your current property and using it as the deposit on your next purchase.
For example, if your home is worth £300,000 and your outstanding mortgage is £200,000, you have £100,000 in equity. By remortgaging, you might release £50,000 of that equity to use as the deposit for a second property such as a Buy to Let, holiday home, or even another residential property.
Lenders will want to make sure you can afford two mortgages at once.
They’ll check:
- Your income and outgoings
- Your credit history
- You’ll still be able to afford the repayments if interest rates rise
Learn more: What is a top-slicing mortgage?
Do you need a deposit to remortgage for a second property?
Yes, in most cases you’ll need a deposit to purchase a second property. Most lenders will want you to put down at least 20–25% of the total purchase value when buying a second property, unlike first homes that typically require just 5-10%.
The money you release from your current home can usually act as the deposit, but if you’d like to pay a larger amount upfront you could use savings too.
Keep in mind that the more you borrow against your current home, the higher your monthly repayments will be. It’s important to balance the short-term goal of buying a second property with the long-term affordability of your first mortgage.
Remember: Don’t forget to budget for stamp duty too. Second homes and buy-to-lets attract a 3% surcharge on top of standard stamp duty rates. For example, if you’re buying a £200,000 second property, you’ll pay an additional £6,000 in stamp duty compared to a first-time buyer.
Read more: Are house prices rising?
Want to find out how your stamp duty will change?
Use our stamp duty calculator to see how much you’ll pay when you purchase another property.
How to remortgage to release equity to buy another property
To remortgage your current home and buy another property, you need to follow these steps:
1. Work out how much equity you have
Equity is the difference between your home’s current market value and the outstanding mortgage balance. The more your property has risen in value (or the more you’ve paid off), the more equity you’ll have.
👉 Example: If your home is worth £300,000 and you still owe £180,000 on your mortgage, you’ve got £120,000 in equity. Depending on your lender, you may be able to release a portion of this to use as a deposit for your next property.
2. Work with a mortgage broker
Not every lender has the same rules. One bank might decline your application, while another will be happy to lend. A broker will know which lenders to approach and can compare deals across the market.
For example, at Tembo we check your eligibility against more than 100 lenders and over 20,000 mortgage products, including specialist schemes, in a matter of seconds.
3. Apply for a remortgage
Once the right deal has been found, your broker will submit the application for you. The lender will then run affordability checks, looking at your income, credit score, outgoings, and the value of your property to decide how much you can borrow.
4. Unlock money from your current home
If your application is approved, you’ll receive a mortgage offer that confirms the amount you can borrow.
5. Apply for your second mortgage
With your deposit ready, you can apply for the mortgage on your second property. The lender will want to be sure you can manage both mortgages.
If you’re buying a buy-to-let, the lender will usually want to know how much you expect to make in rent — and whether this is realistic. If the rent isn’t enough on its own, you might need a top-slicing mortgage, which takes your personal income into account too.
Throughout the process, your broker will guide you, handle most of the admin, and make sure your applications go smoothly.
Learn more: The ultimate guide to buying a second home
Find out how much you can release with our handy remortgage calculator
Use our remortgage calculator to work out how much equity you could release to buy another property. It’ll also show you what your new monthly payments might look like.
You’ll need to tell us:
- Your current mortgage balance (give us a rough idea if you’re not sure)
- The current value of your home
- The amount you’d like to borrow
The calculator will then estimate how much equity you could unlock and whether it’s enough for the deposit on your next property.
See what you could be offered today
To see whether remortgaging your home to purchase another property is a viable option, all you have to do is create a free Tembo plan. We’ll assess your eligibility for thousands of mortgage products from across the market in seconds to generate a personalised recommendation. Then, you can book in a free call with our award-winning team.
