Chances of getting a BTL mortgage?

ssbg14284

I would really appreciate some advice. Me and my husband are thinking of cancelling our pension and instead investing in a property. We currently have a 210k mortgage and approx 16k in loans/credit cards. We are in our 30s and jointly earn 70k.
Do you think we could release equity from our house (about 50k) to put down as a deposit for a btl property in th region of 200k?
Any advice would be appreciated

amnblog

You could but it doesn't mean it will make you more money than your pension.

Daniel54

Ceasing to contribute to your pensions would be a very bad idea -throwing away employers' contributions and the tax relief.A BTL cannot compete with two pensions,particularly with your earnings and even more so if one of you is paying higher rate tax

Paying off the debts as a priority would appear to be a good idea

jayson043

What about saving the 50k, and doing this in a few years. What's the rush?

dimbo61

You have a mortgage of 3X joint income and £16K of debts.
I think taking on even more debt and " cancelling " your pension would be a GREAT IDEA NOT.
Are you Mad?

Thrugelmir

ssbg14284 wrote: »

We currently have a 210k mortgage and approx 16k in loans/credit cards.

Borrowing a further £50k to fund the purchase of a BTL at the current time suggests that you aren't managing your finances particularly well. While pensions are indeed important. They shouldn't be your priority at the current time.

ssbg14284

Thank you for your time and advice it's just we've seen a few good houses and the temptation I suppose has got to us. We really don't want to be working in our 60s and would ideally like to work part-time in our late 40s and thus we saw the btl as a good alternative.

Thrugelmir

ssbg14284 wrote: »

Thank you for your time and advice it's just we've seen a few good houses and the temptation I suppose has got to us. We really don't want to be working in our 60s and would ideally like to work part-time in our late 40s and thus we saw the btl as a good alternative.

If only life were that simple. If it were everybody would own a BTL.

Daniel54

ssbg14284 wrote: »

Thank you for your time and advice it's just we've seen a few good houses and the temptation I suppose has got to us. We really don't want to be working in our 60s and would ideally like to work part-time in our late 40s and thus we saw the btl as a good alternative.

Strikes me you haven't done the numbers if these are your early retirement ambitions

Suggest you post your ideas for early retirement on the Pensions and retirement planning board .These threads may make interesting reading

https://forums.moneysavingexpert.com/discussion/2146737

and

https://forums.moneysavingexpert.com/discussion/2840632

From the limited information you have given so far,you are way off retiring before you are into your 60's

What is your retirement number ?

cns06

A pension is just a tax wrapper around an investment, and quite an attractive one at that. If you are a high rate tax payer its almost a no brainer.


If your end goal is to retire early at say 50 (your retirement age will be 57 - or perhaps more) then I would explore all options as you will need to bridge 50 to 57.

BTL has some issues, renewals, repairs and time without tenants.
These can all eat into any gains, esp over a long period. If you did not have to mortgage it then its a good option but you are going to lose too much IMHO in interest and the above.


ISAs and S&S are other good options. For example lets say you retire at 50, and you want £30k for a new car. You cant sell £30ks worth of bricks out of your BTL... but you could cash in some shares or draw out of your ISA.


IYSWIM.


The best solution is a mixed pot, property, ISAs, pensions, shares and cash are the main options.

ethank

Why would you refuse free cash from your employer, and also the government?

If I stood in the street and told you that I would give you the choice of a house with a mortgage which you have to repay or extra percentages of your salary, plus tax free relief added to your fund until retirement age - but you could not touch either pot until you retired - you would take the free cash everytime.