Hi! I have a question thats been bugging me a lot recently. For context, if you got a loan from a bank for a new kitchen lets say and you took a loan for £10,000 from the bank... You pay this back in monthly payments over 4/5 years lets say. My point is, you pay it back as its a loan, its not free money. So what happens in the case of cash out refi? For example, you've been given a 75% LTV on a £400,000 property (with a £150,000 mortgage) you get the £300,000 (the 75% LTV) pay off the existing mortgage of £150,000, leaving you £150,000 to put into another property or whatever. But the bank/lender that give you the £300,000 LTV, do you have to pay them back the £300,000?? Because they aren't giving you the £300,000 for free? Maybe my heads blagged, but I'd absolutely love some clarification and an answer. Thank you!
@@BritishHomeInvestors Yes buddy but HOW do you pay the loan back, is it in monthly instalments??? For example... In a cash out refi, lets say you have a $100,000 property, you put a 20% deposit down and you then got a $80,000 mortgage.If its a buy to let interest only mortgage after 10 years lets say the mortgage is still $80,000. But after 10 years the value of the property goes up to $200,000 so i want to cash out refi. I get a 75% LTV for $150,000. (my question is coming soon don't worry lol) With this 75% LTV money i can pay off my original $80,000 mortgage leaving me with $70,000. Which i can put down into another property or whatever. MY QUESTION IS... the original LTV money off $150,000, the 75% LTV of the $200,000 property. How do you pay this money back???? To me it just seems like never ending loans. Theres a tenant in the 1st property which mortgage you have payed off with the $150,000 (the 75% LTV) who is giving you rent. But when you then take the rest of the LTV money and put it down as a deposit on a 2nd property you will get yet ANOTHER mortgage (loan) which you will have to pay back on top of the loan from the LTV.... PLEASE PLEASE HELP
Exactly. You build up more and more debt as you buy more and more properties with debt. However the rent you receive on each property then pays the mortgage on each property. I’d recommend you speak to our mortgage brokers linked in the description of my videos.
