Advice pls: which way to drive a windfall?

udhi_2

Hi all,
Bear with me, on this.

I am heading for a windfall of almost £30,000 :kisses:. Probably for the first time in my life, I have decided to do the right thing and look at my debts.

I have two houses. One is in London, 135,000 mortgage, which due to work circumstances, I have had to rent out. Income is apr 300 after paying mortgage on it. The Mortgage is in its second year of a 3 year fixed term. £800 pm. Pretty decent return of rent as you may agree.

The second one is in Preston, a little end terraced, where I bought my first house. 69,000 owing. Rented out, paying about 320 fixed INTEREST ONLY and gives me £50.00 or £80.00 per month which probably helps cover insurance and upkeep obligations. The fixed term is ending this month, and I intend to get another long term fixed interest mortgage. The house might be worth 100,000 on a VERY good day, provided people were interested in buying. I was hoping to keep this house as nest egg. I changed a job and do not expect to get much of a pension when I retire. I was hoping that prices would have picked up sufficiently in 20 years for this house to allow me to do so.

What do you think I should do, with this, nearly £30,000? Should I drive it into the 135K mortgage, shoring up against future interest hikes and enhancing income?

Do I nearly half the sum owing on the 69K house, which probably is not going to do any better in the rental stakes? But makes the repayment mortgage approach more viable. Perhaps allowing me to increase payments and attempt to own the house outright within 10 years or so?

ANY advice would be much appreciated. I am 40 and in gainful employment, so assume a stable if somewhat risk-averse economic lifestyle.

SeriouslySeekingtoSave

Oh dear I'm afraid I can't give you any proper advice. This message will bump the thread up but you might be better actually speaking with a financial advisor. Good on you for intending to spend it wisely though!

tattycath

sorry i can't help either but i'm bumping the thread for you. Independent financial advisor might be a good plan as has been suggested.

dimbo61

So many questions?
You "own" 2 properties with mortgages but both are rented out so where do you live?
1 mortgage is interest only and 1 is repayment and you have given the LTV of the preston property but not the london one !
You were living at one time in both properties but is the london property on a normal mortgage with consent to let ( how long)
What do the mortgages revert to at the end of the current deals and have you got an accountant?
Complex tax implications so he/she would be the best place to start

Rebob

I would pay it on the interest only mortgage and when the current deal is up switch it to a repayment which should be easier with such a large capital repayment.

udhi_2

Hello,
Thanks for your advice people. I have a starting point now.....an independent financial advisor....and.......an accountant??!! I have a lot to learn!

The LTV on the London hut is about 60%, I believe, it has another 3 years to go before it comes out of it's fixed term contract.

I will have a mooch on the forum, find out hot to select a good accounts person and an IFA, over next week.

Thank you all!:T