Lulabelle's MFW Diary

gallygirl

lulabelle1 wrote: »

Thanks Ed! There'll be no slums in my little property empire though!! :rotfl:

Obviously didn't buy any of the ones we discussed then :rotfl:

"Joke"

How exciting, completely missed this news, off to PM you , congratulations :T.

lulabelle1

nattypants wrote: »

Happy 2000th post_party_

You might not be mortgage free by 2016, but if this were a game of monopoly you would be have a nice wee house empire accumulating, and I would be looking at my community chest card which would read 'excuse me, but when TF are you ever gonna do any MOPs?'

Meh;)

Thanks Natty..... We'll both be hanging around here for a wee while that's for sure. I'm only doing the B2L so that I can keep you company xxx

lulabelle1

Sort of updated my signature but think I need to set some new goals....

lulabelle1

B2L seems to be plodding along.... Just waiting for the various people involved to do what needs to be done in order for it all to come together.

I've been spending some time thinking about long term financial plans for the future... Whilst we're still hoping to be Mortgage Free earlier than our original mortgage term, we're in agreement that we need to focus on other areas:
Regular Savings Accounts
Cash ISA
Open Stocks & Shares ISA
A small number of B2L properties

With that in mind, I've finally updated my signature to take all of this in to account, the upshot being that we've just added 7 years to our planned MF Date.... Eeeeeeeek

Of course, like anything, plans will vary as time goes by, but it seems like a fairly good plan for the time being.

It will mean a renewed sense of focus in regards to spending and certainly no new leather goods for some time!

edinburgher

So, what is the MFD for B2L 1?

Or are you more likely to just plough anything back into deposits for future properties?

I have been thinking about such things today. I don't know if I can be bothered with B2L, but very few investments are quite so leveraged. My inner Scot likes the idea of someone else paying my equity for me :rotfl:

gallygirl

edinburgher wrote: »

My inner Scot likes the idea of someone else paying my equity for me :rotfl:

Not only that - you put down say 15% but the nice building society allow you to keep 100% of the capital gain :T.

edinburgher

gallygirl wrote: »

Not only that - you put down say 15% but the nice building society allow you to keep 100% of the capital gain :T.

What about CGT? And yes, I know it's not the building society that charges that.

Also - 15%? There can't be too many B2L mortgages with rates that aren't usurious for 85% LTV?

gallygirl

edinburgher wrote: »

What about CGT? And yes, I know it's not the building society that charges that.

Also - 15%? There can't be too many B2L mortgages with rates that aren't usurious for 85% LTV?

CGT - avoided when we sold before (literally by about £50 on one!) as had owned one a while and lived in the other. Refusing to think about it in future .

Maybe 15% was a bit ambitious, but principle holds.

BTL's are a bit of a hassle - but they're why I should be able to retire v early so I'm obviously in favour .

lulabelle1

My theoretical B2L plan at the moment is:

First 2 B2L's - deposits will be funded from MOP's made to date. The deposits are a killer - 25% - 30%. We're having to do 30% on this one.

We will continue to make MOP's, however, these will be drawn back once enough has been paid to fund the next B2L deposit. So, we've set an amount that we will pay off the mortgage each month to aim for the 10 year MF goal, any other MOP's are purely savings for the next B2L deposit.

We are putting the B2L's on repayment mortgages for 20-25 years. We have no intention of making OP's on them at this stage, but maybe that will change if/when we are mortgage free on our own property.

Our "plan" is that we would hope for the B2L's to be paid off by the time we want to properly retire. At that stage, we would NOT sell them (so no worries about CGT) but keep them and have the rental as our main income stream - hence the need to have maybe 5 of them........

Obviously it's very early days and it really is just a plan at the moment and perhaps I might have some terrible experiences with this one and then be put off the whole idea, but for the time being it seems logical and doable so that's where we're heading......

At the same time, I'm hoping that we can pay in the amounts I have in mind for the Cash Isa and the S&S ISA - the plan is that any monies paid in to these will not be touched, but will be used as a nest egg for when we're older - either providing much needed ready cash or giving us a small income each month from the interest etc.

Pension - well, I have a smallish pot from where I've paid in in the past but I'm not actually currently paying in to a pension. Due to my current employment set up I have no employer contributions, so just what I would be paying in. I decided some time ago that I'd prefer to be in control of my savings etc - hence the B2L idea and the various ISA's. This is probably totally stupid and perhaps I might change my views on it. However, whenever I use various calculators to work out the likely monthly/annual income from a pension if I was to pay in say 300/500/1000(!!) per month, the results are shockingly poor and that's why I'm keen to look at other avenues...........

lulabelle1

edinburgher wrote: »

So, what is the MFD for B2L 1?

Or are you more likely to just plough anything back into deposits for future properties?

I have been thinking about such things today. I don't know if I can be bothered with B2L, but very few investments are quite so leveraged. My inner Scot likes the idea of someone else paying my equity for me :rotfl:

I'm just expecting them to run for 20/25 years Ed.... The mortgages will be on repayment, so to be honest, there wont be a massive amount of money left over each month - anything left over will accumulate for repairs and the possible tax bill each month on any profit....

If the we can get the rent to cover the mortgage and expenses then we'll be happy....

We did look at the interest only option, but since the long term plan is to live off the rental incomes, repayment is our best option as we're not at this stage planning to sell the properties down the line.....