£150 "spare" cash, save or use for debt?

MustStopSpending

I rent a flat out, the mortgage is interest only and on the standard variable rate so at the moment I am making about £150 a month from it. It is run in a seperate bank account and I don't touch it usually, apart from having to spend all the savings in there on a new boiler recently.

My question is I have now got £200 spare cash in there and I am wondering whether I should pay off debt with it or save it in case A) my mortgage goes up to beyond the rent I receive, the flat is ever empty and I need it to pay the mortgage and C) any repairs etc need doing.

As at Oct 1st I will have £350 cash in there which would clear one credit card so I don't know what to do.

FYI - Rent is £475 and mortgage is £310.05, then there is maintanence and building insurance.

Any suggestions welcome!

Tixy

Tough choice in many ways.

I think having a buffer is a good idea and would be tempted to leave some for maintenance issues and the possibility of a vacant period.

But if it keeps building up then it makes sense to consider what interest you are paying on any debts you have. From your signature it looks like you are not paying anything extortionate in terms of interest.
If you did pay off debts with it do you have a way to re-use a card to pay for any maintenance issues etc with the house? If all your cards had been frozen so you couldn't use credit in future I would want a bigger buffer.

As an aside - are you saving up for the tax bill you will have on the profit from renting this flat out?

MustStopSpending

Would have to use credit card if I use the money towards debt but have lots of these!!!!

Think I will keep a buffer of one months mortgage payament and an extra £100 then start using excess towards some debt.

Tax bill is saved from DH overtime.

HappyMJ

I would save for all the reasons you've given. A void usually lasts for a few weeks every few years so I'd save at least for that then any possible repair bills and the inevitable interest rate rise in a few years.