Mortgage Free by 01/01/11...so goes the plan

gallygirl

It's not procrastination - you have made a conscious decision not to make a decision .

So glad you're paying off on Thurs as I'll still be here to read about it :T

taxi73

not long to go now.must be very exciting.

wynnvegas

Morning All,

Thanks RT and GG - That could all change of course but we've settled for settling at the minute - albeit we've been busy planning the ground floor of the house that we're going to build this last couple of nights. We've decided to wait until December to kick off the great land hunt and, between now and then, try to speak to a professional to roughly get an estimate of the size of land we'll need. We've got friends in the same boat (although long-time mortgage free) so there may yet be an option to get a bigger piece of land and build a couple of big houses - it'll be like SimCity coming alive!!

Morning Taxi - Properly exciting! I'll give you a wave as I pass Blackpool today on my way down to Oxfordshire! In saying that, we've been hitting the credit cards pretty hard this last wee while with business travel and Christmas shopping so we may yet not be quite as flush next month as I had hoped!

Off on business for the rest of today and for all of tomorrow. I will be back on Thursday to hopefully proclaim the absolute freedom!! I just hope I get paid on Thursday and not Friday as, with another loan being needed for family, M's salary and what we have left in the bank won't cover the outstanding mortgage amount...

Never had time yesterday to get to Tesco's so still no iphone for me. I'll get to that on Thursday if only to give the credit card a proper shock! It hasn't been used this much in months so I'm glad it hasn't expired itself on me!

Cheers,

Billy

determined1_2

Billy

Don't forget you would have to pay income tax on the profits from the rental income and capital gains tax on any appreciation in the house value when you come to sell it.

If the mortgage is BTL the interest rate is going to be higher than a residential mortgage and thus eating into your profits. You could release the equity in your own home to buy the BTL and it will then be a residential mortgage and then a lower rate. You can still get the tax relief from the mortgage interest.

Are you both higher tax rate payers? If only you, you can put the property 100% into the Mrs name and any profits will be taxed at a lower rate. Or none at all if profits lower than personal allowance.

When you come to sell, make sure the property is in both names (even if few weeks before sale) as you will then get two lots of annual exemptions against any capital gain. Currently just over £10k a year. However, you will need to consider the CGT rates at the time as it could be more beneficial to keep in say only the Mrs name if the CGT rate is higher for higher rate tax payers.

Or............when you come to sell up to say buy retirement home, sell current home and move into BTL for a while. Then sell BTL and buy retirement home. As you've lived in the BTL as your primary residence, no CGT to pay.

I'm not a qualified tax adviser but I do work in the industry. Just my thoughts so obviuosly get some professional advice if you do go ahead.

taxi73

great post there determined ..some very useful info.

wynnvegas

That's fantastic determined - I think I understand about half of that but I'm coming off a 7-hour drive and I'm not completely back in the land of the sane yet!! We'll definitely take advice from the professionals but I'll always reserve the right to bounce a few bits and pieces off the good folks on the MSE forum who, collectively, are a treasure trove of information and assistance. I do try to get over to the employment and redundancy boards to give the benefit of my professional advice on occasion but not half as often as I would like.

M is on the lower rate of tax. I would imagine being a higher rate taxpayer would be more fun if I was way over the odds but I'm not that much above the threshold so it doesn't particularly impact me at the moment - I could see how that type of transaction could cause me a serious issue though!

Taxi - I didn't see you waving back at about 2pm today!!

Cheers,

Billy

wynnvegas

Hi Folks,

Before I shoot off to the gym, a thought has occured to me about these wee stars and such that live next to the screen names - I got promoted (without ceremony I may add!) to a 2-star MSE corporal but I see some, taxi among them, are all-singing, all-dancing 5-star Ace MSE Generals. Now that I'm after a new goal in life, what's the deal with the stars and how do the additions work? In fairness, if I need to post another 15,000 messages, I'll give it up now!!!

Cheers,

Billy

Froggy-G

Morning Billy!

This post might be early, but I wanted to be the first to congratulate you on paying off your mortgage!! Yes You've done it!! This is a massive achievement!!
You & M should be very very proud of yourselves!!

We are very happy for you, and can't wait to celebrate with you!! :beer:

Hope the grin on your face today when you pay off your mortgage lasts a lifetime!!

Many many many congratulations!!

Froggy

Ps: please don't forget to post on the roll of honour sticky, you truly deserve it! :rotfl:

gallygirl

How exciting!!!!! Let us know how it went, we have champagne and Pringles waiting :j

Froggy - can I interest you in a sneaky preview

Froggy-G

gallygirl wrote: »

How exciting!!!!! Let us know how it went, we have champagne and Pringles waiting :j

Froggy - can I interest you in a sneaky preview

yes please!! Why not! Champagne breakfast it is!!
Thanks Gallygirl

Billy where are you????????????????????????

Froggy