Which mortgage to pay off first?

boyse7en

I've got two existing mortgages, one on my home and one on a BTL. Both are interest only. The home one I am already overpaying every month to reduce the balance. I want to pay off a bit more every month (about £250) but I'm not sure whether to pay more off my home Mortgage, or off the BTL

Home: £88k outstanding: Current rate 1.4%
BTL: £102k outstanding: Current rate 2.25%

Initial thoughts are to pay off the BTL, as it is a higher rate of interest - but the income from the BTL gets tax relief on the mortgage interst payments, so if I pay it down, I will end up paying more tax as the BTL will make more profit.

Bit confused.

getmore4less

Take £1k

pay it off the home is saves £11.40 in interest

pay of the BTL it save £22.50 in interest

with 20% tax you pay an extra £4.50 or £9 for 40%

net £18, £12.50 still better than the home loan.

Leon_W

Or not pay any off any of them and find a better savings rate elsewhere.