Should I pay off my mortgage discussion

Lavinia

Hi - I have a mortgage on a flat that I rent out. My accountant advised me to keep the mortgage as I can claim the interest off the profit from the rent. Was he right?!!
Any thoughts gratefully accepted.

Welshlassie

Yeap, the interest element of BTL can be netted off against any profit.

Redron

I have 18 months to go on my mortgage I do not know what the best thing to do. there is £1700 left to pay which I could afford to pay off, or increase my payments by doubling the monthly payment. I originally got the mortgage through Nat & Prov who were taken over by Abbey. Can I just increase the monthly payment with out arrangeing this with them On internet banking site or do I have to make an arrangement with them?. The amount I pay is £106.14 monthly.

Welshlassie

Redron wrote: »

I have 18 months to go on my mortgage I do not know what the best thing to do. there is £1700 left to pay which I could afford to pay off, or increase my payments by doubling the monthly payment. I originally got the mortgage through Nat & Prov who were taken over by Abbey. Can I just increase the monthly payment with out arrangeing this with them On internet banking site or do I have to make an arrangement with them?. The amount I pay is £106.14 monthly.

You would need to check the T&Cs with the bank. Call them is your best bet. There maybe Early REpayment Charges depending if you are tied into a deal or not, but they can tell you this when you call. They will also tell you how the best way to do it would be.

If you decide to pay it off in total, then ensure you have sufficient emergency savings 3-6-9 months depending on job and sector is ideal.

Good luck

Redron

Thanks welshlassie I am onto it on Monday.

avi_3

just a thought and example - i have about 180k on my mortgage to be paid over next 20 years - currently at 0.79% tracker for life over BoE base rate. i am fortunate enough that i can can actually make overpayments every month - but i have not been doing it and saving it although i will be paying 40% tax on interest- as i plan to move into a bigger house and will have to borrow more - but the current mortgage offers are no where close to my current deal - so if my do move - then my current balance continues with the same deal and the extra borrowing goes on a new deal. but if i make overpayments then my borrowing increases and i have to pay more interest.

I hope my logic is right

Welshlassie

You current borrowing would only be on the same deal if your mortgage is portable, otherwise you would be needing a new deal, otherwise your logic is correct. Save the overpayments and use them as part of the deposit on the new property, that is also assuming that you don't end up in negative equity and need to subsidised your current house when it is sold.

Fear_Manach

I have just received a cheque pay out from my health insurance policy and once I have paid off my debts / loans / credit cards and created an emergency stash I envisage having £50,000. We don't have ISA's but I will look into trying to get those sorted...:o

We have 2 mortgages - one that we're interest only @ 1.99% above BE base rate which is for about £120K- with early repayment / overpayment charges. Since getting ill 4 months ago, we have let this property out to students (as I lived there much of the time before that for work). Illness has beeen taking up quite a bit of time and our first concern was to try to cover the mortgage - but can anyone tell me how we SHOULD be doing this in terms of the tax man? (I know this probably isn't the place for it..just an aside) At first we weren't covering the mortgage, but thanks to family help we met the payments. However, now we have the whole house rented and, with our payments coming down, by March we will be receiving more in rent than the mortgage costs. However, that doesn't include rates (approximately £550 per year - I'm in Northern Ireland) or insurance. Should we be paying the tax man money when that happens? Should the tax man know now that we are letting out the house?

The second mortgage is currently fixed until April at 3.5%, then it reverts to 5.9% for 2 years. It's repayment and I think it's about £126K - not sure if early repayment charges or not, but will find out tomorrow..At the moment we are on a payment holiday until March - and I'm not sure whether or not this means our 3.5% rate will be extended for the amount of time of the holiday..

We have been toying with the idea of buying another property with the money and renting our current home out (we've been trying to sell it for a year). We thought this might be a good way to go because we can get a nicer house for less money now, and our current home is in a good rental area, plus £50K is quite a big deposit.. But because I am off work now, I expect that this would reduce our chances of getting another mortgage..?

I have also just been notified that I will receive DLA (both componets at high rate) and am currently receiving SSP, which will revert to incapacity benefit (I think) within the next two months. Combined, it is still substantially less than I have been used to earning. My husband and I have joint accounts and when we got married, both names went on both mortgages. Am I still considered a tax payer, even though I am not able to work at present? If not, would it be better that any savings were in my name only? I would like this money to help us the best way it can and would prefer to use it without losing any benefit entitlement. Some people may sniff at that but, to be perfectly honest, I don't see why I should lose any benefits that I may be entitled to because I paid extra money every month for an insurance policy that I would rather not have ever had to claim.

I apologise for my complete lack of knowledge on these matters, and for asking what may seem like stupid questions - but we are completely clueless and we don't know where to go for advice. You all seem to know what you're talking about, but it is just confusing me - so thought I would out our case to you.

Any help / advice will be very gratefully receeived.

P.S. My case should have highlighted to you all the benefit of having critical illness cover on your life insurance policy. We would have been far worse off without it and, of course, you never know what life has in store for you. If you don't have this cover - I highly recommend Scottish Provident.

alexis01

Hello,

I have a very simple query:

Given the current low savings rates, would I be better off transferring a sum of money (£10k) I have built up in a cash ISA into my First Direct offset current account mortgage?

The ISA is currently paying a very low rate of 1.5% (variable) whereas my offset mortgage interest rate is fixed for five years at 5.29%.

The only piece of advice that I've received so far is that I should leave the money where it is in the ISA since the interest is tax-free and savings rates could recover in a couple of years' time?

I am now fairly confused. Any plain and sensible advice would be warmly received!

Thanks
Alexis

DAVE1003

hi mate,
just transfer your isa, i've just transfered mine into the yorkshire b.s. e-isa.
i'm getting 3.4 % for over £10,000.
hopefully y.b.s. are one of the more safer banks/b.s on the market.
hope this helps.