Lulabelle's MFW Diary

Arkers

Hi Lulabelle,

Have you considered utilising a mortgage on your own house if you have sufficient equity. So long as you can prove via a paper trail that this money is going to be used for your BTL investment it is my understanding that you can still offset any interest you pay against tax. I have two BTLs and we are just about to do this with one of them. I think that BTL products being quasi-commercial are a bit of a rip off. For example we are having to pay £430 for the privilege of a valuation, wheras the valuation on our residential is nil.

Best of luck - we are of the same mindset and hope for a this to assist with our retirement fund.

lulabelle1

Arkers wrote: »

Hi Lulabelle,

Have you considered utilising a mortgage on your own house if you have sufficient equity. So long as you can prove via a paper trail that this money is going to be used for your BTL investment it is my understanding that you can still offset any interest you pay against tax. I have two BTLs and we are just about to do this with one of them. I think that BTL products being quasi-commercial are a bit of a rip off. For example we are having to pay £430 for the privilege of a valuation, wheras the valuation on our residential is nil.

Best of luck - we are of the same mindset and hope for a this to assist with our retirement fund.

Thanks Arkers.... It definitely makes sense what you are saying and we did give it some consideration..... Once we've funded the deposit on the second B2L from our OP's it will give us a mortgage of around £135/£140k on our own property. There are a few reasons why we don't want to increase this:
-For some crazy reason I still have a dream to get my mortgage paid off early even if it doesn't necessarily make good financial sense (this might change!)
-I hate the idea of owing more money on our own home, it just unsettles me
-I'm employed by my own business and it might not always do as well as it does right now, so for the ability to sleep well at night, I still want to pay down the mortgage on this house in a reasonable time frame as I love the idea of it being ours and that no one can take our house away from us....
-Our existing lener, despite me earning considerably more now than what i did when we bought this house, probably wouldn't advance me any more money because of the complicated pay structure that I have. Despite the fact that all of our accounts are with the mortgage lender, DH works there, we've always been in credit etc etc - they're very strict and "traditional" in how they lend money, so it prob wouldn't even be an option for us.....

edinburgher

Lula, your plans sound eminently sensible (I agree about the deposits looking fairly horrendous).

It would also seem like pensions aren't the best idea when you don't have an employer contribution. That said, you're a higher rate tax payer, aren't you?

Perhaps you could start funneling any left over money into your SIPP once you build up momentum with the first few properties? (Obviously leave yourself enough contingency monies for void periods, large repairs etc.)

Tax relief on money back from leveraged investments that are (hopefully) paying for themselves sounds like the end of a very satisfying circle

lulabelle1

Yes Ed, a SIPP could be an option in a few years time.... I'm going to squirrel what I can in to some Reg Savings accounts for a few years and see whether I can afford to continue to put that money aside every month without needing to dip in to it.... If the answer is yes, then perhaps some or all of the reg savings monies could be sent off to a SIPP instead...

At the moment they scare me as I really wouldn't know where to start, so I'll make sure I try and get my head around it all before I take the plunge.

At the moment, I don't really know whether my savings/investment plans are totally realistic, so I'll see how we get on....

lulabelle1

Had lunch out with a friend today.... mine wasn't very nice and my friend encouraged me to complain, resulted in me getting my lunch for free. In fairness, most of it was still on my plate....

Off to Zumba for the first time shortly. I've only done Aqua Zumba so am hoping that I get on OK without the water!

edinburgher

Off to Zumba for the first time shortly. I've only done Aqua Zumba so am hoping that I get on OK without the water!

Did you have fun? I know several women who lurve to Zumba!

lulabelle1

edinburgher wrote: »

Did you have fun? I know several women who lurve to Zumba!

It was fun! I really enjoyed it.... A little bit out of my comfort zone as I'm not really a dancy dancy sort of person but it was good. :T

lulabelle1

The trouble with exercise is that I'm always hungry afterwards and I have a hankering for crumble and cream.... Sadly we don't have any crumble. In fact we have no cream either. Meh!

lulabelle1

I dreamt about the B2L house we were buying last night - it wasn't a good one either - so think I need to get round there to see it again and put my mind at rest.... Everything is moving forward, surveyor has been booked and mortgage seems fine, so just waiting on the surveyors report and then we can start working towards some sort of completion, which I think will be sooner than later.

I switched my gas & electric online last week - currently with Scottish Power and the deal ends later this month, so next stop EDF - just seem to go round in circles with the various energy companies, but I guess it's how you have to do things. Also get cashback apparently, everything helps.

Did 3 exercise classes yesterday - I realise that makes me a total nutter, but they're all fairly low impact classes, so it wasn't too strenuous - I did Aqua Aerobics in the morning and then did Power Yoga and Pilates from 6 til 8... My reward was rhubarb crumble and cream when I got home.

Today I have Aqua Zumba at 1 (my lunch break) and then Body Combat in the evening. I'm finding that having my exercise classes is helping me not be on the internet looking at things that I shouldn't be buying.

edinburgher

I switched my gas & electric online last week - currently with Scottish Power and the deal ends later this month, so next stop EDF - just seem to go round in circles with the various energy companies, but I guess it's how you have to do things.

It does get boring. We were on Scottish Power, went to EDF, came back to Scottish Power and are now off again :rotfl:

Enjoy all the exercise!