Should I sell my buy to let property ??

Floyd1973

Hi, I am new to this site..... Here is my dilema.......

I have a buy to let 2 bed flat worth £165,000 (mortgage is interest only £140,000) monthly rent £700. Ive had it for 7 years. mortgage payments at the moment are £480. plus insurances etc total cost is £580.

I also have a secured loan on my own house which has £19k left to pay over the next 10 years. costing me £260 per month.

Would it be wise to sell the buy to let to clear this loan?

I am worried about interest rates going up. Also I am not in a good position to fund any work at the buy to let property or cover mortgage if its empty.

We are in our 40's and have children.

Is it best to keep the buy to let going? or sell it and pay the secured loan off to save paying the interest on the loan which will be about £11K over 10 years!!!

Any advice welcome............

m_13

Have you ever lived in the flat as your principle residence? If not then you could have capital gains tax to pay depending on how much you bought it for.

HappyMJ

Personally I'd keep it. You can fix the rate on the mortgage if that is one your primary concerns.

Floyd1973

No I havent ever lived there. Is capital gains on anything over £8500 profit?

We paid £140,00 for the property and the mortgage was for £125,000, but we remotgaged when it went up to £165,000 6 years ago and took £15,000 from the equity. Then the prices went back down until recently.....we could poss get £160,000 easily.

It is only in one persons name.

Floyd1973

I bought the property as a I was going to live in it, and rent our house out...but never did...so its not on a buy to let mortgage....

Floyd1973

Should I look more long term and forget about the secured loan and carry on paying it?
Because the mortgage is interest only it not going to go down at all.

It only because the property have prices have gone up enough for me to wipe out the secured loan that has got me thinking......

silvercar

Are you married? If so, the first action is to put it into joint names so that any future CGT liability can potentially be reduced by the use of 2 personal CGT allowances.

CLAPTON

impossible to say without all the financial details

but if you truely mean you can't afford a letting void or any repairs or interest rates rising then it seems a little mad to keep it.

Floyd1973

Do you think the house prices will keep rising?

I feel like taking what profit is there as its taken 6 years for house prices to rise....also at the moment interest rates are nice and low, but probably not for for much longer.

If we put it into joint names we will have to make mortgage company know we are letting it out so wanted to avoid that.

Thanks for all your comments

Wish I had a chrystal ball...lol

Floyd1973

CLAPTON wrote: »

impossible to say without all the financial details

but if you truely mean you can't afford a letting void or any repairs or interest rates rising then it seems a little mad to keep it.

We have had to manage it, but luckily same tenant has been there 4 years now. Its only now getting a bit of equity and i'm tempted to take it.

Floyd1973

silvercar wrote: »

Are you married? If so, the first action is to put it into joint names so that any future CGT liability can potentially be reduced by the use of 2 personal CGT allowances.

Thanks. We did look into that but it would mean telling the mortgage company that we are letting it out.

Think i'd rather just sell it in my name only and see what happens.