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Overpay or Offset?
localboy
Posts: 59 Forumite
Our buy to let mortgage fixed rate is coming to an end at the end of this month. The balance owing is £50k and I have approx £40k savings that I could use to overpay it. I currently work full time and the income from the rental property is taxable too. I aim to finish work asap and can then live comfortably off the rental income. I'm thinking the best plan is to overpay a lump sum and then overpay each month to bring the balance down as quick as possible.
Do you agree?? Or is there something more financially beneficial I could do with the lump sum? I don't want another rental property as we already have 2.
Do you agree?? Or is there something more financially beneficial I could do with the lump sum? I don't want another rental property as we already have 2.
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Comments
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Personally I would always keep some personal savings. Once you use them to reduce the mortgage they are gone for good.I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0
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Retain an emergency fund if you decide to overpay.
What's the back up plan if the property generates no income?
Will you be able to save once you are wholly dependent on the rental income?0 -
This is something you should talk to an accountant about
Income, Tax, pensions, age, long term plans, yield, condition of your properties all come into the equation.0
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