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Borrowing vs selling investments

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  • Fatbritabroad
    Fatbritabroad Posts: 573 Forumite
    Fourth Anniversary 500 Posts
    My investments are either to pay mortgage off when the ten year fix comes up or to try and retire early eventually was my plan. I specifically fixed my mortgage to allow myself to invest instead. I just feel now I've managed to build it up I'm loathe to sell it and would be hard pushed to not return more than the loan. P2p is a fair point I'm not blind to the risk that's why i have it spread across multiple platforms and most is in the lower interest lower risk loans like assetz and lending works. I have max 6. 5k in any one platform. I'm not adding anything further to p2p
    I also think property is going to be pretty stagnant so feel having more outside of this would be a good move and run a larger mortgage while I'm young. I keep toying with the idea of btl for income rather than capital growth but think it's too much hassle tbh
  • DiggerUK
    DiggerUK Posts: 4,992 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Photogenic
    Do you not have the option to purchase the car you are currently leasing.

    There are costs involved with a second mortgage, why spend when you can use cash savings to pay for planned spending, and have rainy day funds provided by equity release if necessary. Equity release can also be used to cover any overspends.

    Your mortgage is a debt don't forget, why increase debts when there is no need to..._
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    I just feel now I've managed to build it up I'm loathe to sell it and would be hard pushed to not return more than the loan. P2p is a fair point I'm not blind to the risk that's why i have it spread across multiple platforms and most is in the lower interest lower risk loans like assetz and lending works. I have max 6. 5k in any one platform. I'm not adding anything further to p2p

    As far as P2P goes. Not the platforms that worry me. More the nature of the market. Risk is priced. In the chase for yield , the correlation has been lost.

    If investing was that easy, i.e. leverage with debt. We'd all be librarians. Been too smooth for too long.
  • Fatbritabroad
    Fatbritabroad Posts: 573 Forumite
    Fourth Anniversary 500 Posts
    Yes I'll use as much cash as I can without leaving myself completely out. I'll need to realise probably another 20 to 30k to get everything done

    No unfortunately the car can't be bought its something to do with it being a personal lease? Straight pch not pcp.
    I've just decided I'm not enough of car person to spend that much on a car and would rather buy appreciating assets lol. I do see what you're saying I just keep coming back to the interest rate on what would still be a very affordable mortgage vs the likely though not guaranteed return on investments

    and also the equity is sat in the house not doing much at present. This reduces my monthly payments considerably and leaves me plenty of liquidity for the future. But then as you say I could just sell some investments (mostly p2p). Still have probably 70k in the bank and keep the debt the same. Im normally fairly 'Cautious'. Calculated is probably a better word as I appreciate 100%equities isn't Cautious! Leveraging the house seems like a calculated risk that isn't over exposing myself
  • steampowered
    steampowered Posts: 6,176 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    If you are intending to be in that home for a long time, a long fix is a very good idea.

    There is no sense in selling investments when you can borrow at 2.59% over a 10 year period under a perfectly affordable mortgage.

    The average long term return on investments is 8-10%. Most businesses dream of being able to borrow at 2.59%.

    I would be putting perhaps £200pm aside into long term savings for the child, perhaps through a junior ISA.
  • Fatbritabroad
    Fatbritabroad Posts: 573 Forumite
    Fourth Anniversary 500 Posts
    If you are intending to be in that home for a long time, a long fix is a very good idea.

    There is no sense in selling investments when you can borrow at 2.59% over a 10 year period under a perfectly affordable mortgage.

    The average long term return on investments is 8-10%. Most businesses dream of being able to borrow at 2.59%.

    I would be putting perhaps £200pm aside into long term savings for the child, perhaps through a junior ISA.

    Yes thanks steam powered I'll do that when the child is born in November
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