I understand that ordinarily an individual could remortgage his own house and use the additional funds as a deposit on a new BTL and claim tax relief (after allowing for the new rules) on the interest on the mortgage relating to the deposit for the new purchase.
However, does this work the same way if the property being purchased is a FHL which are not subject to the changes to tax relief on finance costs? Would it have to be a 'FHL' loan to obtain full tax relief but are generally more expensive in terms of finance costs?
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Don't see why you can't claim in the normal way. Generally it's the purpose that the funds are used for, not the property on which it's secured.
I agree with Wanderer - it's the purposes of the loan, not the security for it, that matters.