Last reviewed on 11th September 2023 by Martin Alexander (Mortgage Advisor)
We’re often asked, “How many mortgages can I have?”. The good news is that it’s possible to have more than one mortgage. That being said, not everybody will qualify for a mortgage, let alone multiple mortgages.
There are many factors for whether you can have more than one mortgage which we’ll explain in this guide. We’ll also look at ways to increase your chances of having multiple mortgages.
Our experts can help you further once you’re ready to apply for a mortgage. Having more than one mortgage is a risk and isn’t something you should rush into.
- How many mortgages can I have at the same time?
- Can I have multiple residential mortgages?
- How many buy to let mortgages can I have?
- Can I have multiple commercial mortgages?
- Does my income determine the number of mortgages I can have?
- Can I buy another house if I already have a mortgage?
- Factors to consider before taking multiple mortgages on
How many mortgages can I have at the same time?
As we’ve established that it’s possible to have more than one mortgage, you may be wondering how many mortgages you can have at the same time. It’s possible to have as many mortgages as you want, subject to meeting the criteria for having multiple mortgages.
You’d need a good reason to have more than one mortgage, as the cost of multiple mortgages can soon start to accumulate. For instance, having multiple homes wouldn’t really make sense, whereas having multiple buy to let properties would.
Can I have multiple residential mortgages?
It’s possible to have more than one residential mortgage, but you’ll need to nominate your main residence. Buying a second home isn’t normally an issue, but trying to get a third or fourth residential mortgage can be very difficult.
Lenders limit multiple residential mortgages due to illegal sub-letting. This is because it can be easier to get a residential mortgage as you won’t require a larger deposit than you would for a buy to let mortgage.
You’ll also need a good reason for wanting a second home. For instance, you may work in a different city and no longer want to commute or you’d like a holiday home for your own leisure.
How many buy to let mortgages can I have?
There are no limits to how many buy to let mortgages an individual can have. That being said, certain lenders will limit how much they’ll lend to any given individual. This is to simply minimise their risk. This doesn’t stop landlords from having multiple buy to let mortgages across several different lenders.
Some landlords may have amassed portfolios that contain hundreds of properties. This is especially true with limited companies that have been created for the sole purpose of property investment.
It’s also possible for landlords to use portfolio mortgages. This would bring their entire portfolio under a single monthly mortgage payment. This is to make managing large portfolios easier. Furthermore, landlords can borrow more against their portfolios to buy more property.
Read more: Getting a portfolio mortgage.
Can I have multiple commercial mortgages?
Commercial mortgages are similar to buy to let mortgages, in the sense that there’s typically no limit to the number of mortgages you can have. Investors may choose to solely invest in commercial property. In terms of getting approved for multiple mortgages, it’s rarely a problem.
You’ll still need to meet the criteria of your commercial lender. Furthermore, it’s likely you’ll need a minimum deposit of 25% for each commercial mortgage. Additional mortgages may require higher deposits of up to 35% or more.
It’s also common for limited companies to have multiple commercial properties across a region or even nationwide. This is to accommodate multiple branches that a business may have.
Does my income determine the number of mortgages I can have?
If you’re buying a home for residential purposes, then your income will determine the amount you can borrow. That said, you’ll still only be able to get a limited number of residential mortgages. There’s rarely any logic for having more than one or two properties to live in yourself.
In comparison, your income is unlikely to affect the number of buy to let mortgages you can have. This is because most buy to let lenders will assess the projected rental income of your investment, rather than the income you earn from employment.
A buy to let property should provide you with enough rent to pay your buy to let mortgage. Most lenders will require your rental income to meet 125%-145% of your mortgage.
Can I buy another house if I already have a mortgage?
Yes, if you want to move home and need a mortgage to do so, you may not necessarily have to sell your home before buying a new one.
It’s possible to retain your old home for your own personal use or more commonly, as a buy to let investment. This can provide you with an income to help pay your new mortgage. This is more commonly known as a let to buy mortgage. You’ll then have one residential mortgage for your new home and a buy to let mortgage for your old home.
Factors to consider before taking multiple mortgages on
Having one mortgage can pose a risk, but having more than one mortgage increases your risk quite considerably. Before you make any commitments, it’s important to decide whether having more than one mortgage is a risk you’re prepared to take on.
Factors to consider include:
- Are you able to afford more than one mortgage? Although lenders will carry out affordability tests, the responsibility of paying two mortgages will be yours.
- Do you have a good credit score? If you have bad credit, then having more than one mortgage can place you in a very high-risk position. For instance, failing to repay a mortgage could result in that property being repossessed, which will also damage your credit score further.
- How much debt do you have? Having a lot of debt is rarely advised. You’ll eventually have to repay each mortgage, so do bear this in mind and don’t borrow more than you’re able to.
- Are your reasons for having multiple mortgages justified? Having a second home or an investment portfolio is very common. That said, buying a home that you’ll hardly ever live in may not be worth it.
- Do you have the time to maintain multiple properties? Maintaining one property can be difficult, but maintaining a number of properties is much harder. Managing an investment portfolio requires time, money and management, so you’ll need to be prepared for the additional work involved.
Despite the risk, owning multiple properties can be a smart investment. Whether you own a second home or a buy to let portfolio, you may receive rental income and benefit from an increase in property prices. Our experts can help you if you’re still unsure of what to do next.
About the author
Martin is a senior mortgage advisor and has held a CeMAP qualification for over 15 years while also completing an MBA in Global Banking & Finance.