The situation
A family wants to move to a £975,000 home while keeping its current property as a rental. The existing home is assumed to be worth £650,000, but a lender valuation has not taken place. They hope a let-to-buy refinance could provide part of the next deposit.
What makes this more involved?
The hoped-for equity release is not established until the loan, valuation, rent and existing redemption are assessed. The next residential lender also needs a clear picture of the retained property and any commitments. Tax and transaction costs must be included separately.
How I would approach it
Assess each property independently
Obtain realistic rental evidence and review the existing mortgage. Research the new residential purchase using the household’s actual income, commitments and planned landlord position.
Reconcile the deposit calculation
Start with the possible new rental mortgage, then deduct the current balance, applicable charges and costs. Do not equate gross borrowing with deposit cash.
Coordinate legal and timing work
Confirm any linked completion requirements and the ownership structure with the conveyancers. Retain funds for a rental void and moving costs.
What could change the plan?
What if the rental valuation is lower?
The let-to-buy loan may be smaller, reducing the onward deposit. The family may need more cash, a revised purchase budget or a different plan.
Can a tenancy start before permission is obtained?
The existing lender’s requirements and the legal letting position need to be resolved first. Planned letting should be disclosed accurately.
What this would establish
Understand both loans and the net deposit as one sequence, with a clear contingency if either property assessment changes.
Is released equity the same as the new mortgage amount?
No. The existing debt, charges and transaction costs must be considered when calculating the cash available.
Link to this answerEducational content reviewed 9 October 2026. Individual advice requires an assessment. Lender and policy criteria can change.
Further reading: MoneyHelper: buy-to-let mortgages. These references provide background information; they do not indicate acceptance of this example.