Property investment advice - is this small change in grand scheme of things?

doe808

Newlyboughthouse said:

doe808 said:

Newlyboughthouse said:

My plan with the remortgage funds are to part put into property bonds, part buy a flip property, part buy a holiday home.

  Have you considered the SDLT/LBTT tax implications of doing this? Seems that your going to be paying a fair whack of extra tax with this plan.

 

Of course. I have had a tax appointment already, and another coming up. Very complex but there are things that can be done.

Be very careful. Insofar as I am aware, there would be little scope for legitimately reducing the tax paid on the plan above. HMRC have been particularly successful recently against advisors who deal with schemes that purpote to do the same.

Aceace

Newlyboughthouse said:

Hi all

I have a dilemma. I signed up for a 2 year remortgage fix at the start of November (too late to get out of cooling off period). I have an outstanding balance of £55,000 on my mortgage on a house worth around £280,000. 

I want to remortgage to release the equity to invest, however, the penalty is a psychological blocker for me (2%). So I would have to pay £1,100 penalty. Like most probably I am averse to paying avoidable charges, but I know obviously sometimes this is inevitable. The rate reduces to 1% penalty in year 2 of the fix.

What are your thoughts - is this small change, or would you wait, continue to aggressively pay down the outstanding balance to potentially get a lot more equity out in a year or 2?

You don't say how much of the equity you're planning to invest, but if its a large portion then yes it's small change. E.g. if you were planning on investing £150k then the fee only represents 0.7%. Personally, I don't have the balls to risk the equity in my home. 

My plan with the remortgage funds are to part put into property bonds, part buy a flip property, part buy a holiday home.

What do you guys think - would you think nothing of the penalty and do it now or wait?

The penalty wouldn't worry me. Putting too many eggs in a flip property or a holiday home would bother me. I prefer to diversify my investments over multiple properties (or other investments). If I had particularly strong and relevant skills that I could use to add value it might be different (builder, interior designer, etc). Sadly I don't, perhaps you do. 

Also, I'm not keen on the holiday home concept. My father bought a time-share and we soon got very bored with having to holiday in the same place to feel that we were getting value out of it. Each to his own though. 

Thanks

I've added my thoughts in bold above. 

Confused_landord

Hi , Everybody ,,, i have BTL's for a long time now ,but what i dont know  is how do i go about getting a mortgage on a commercial property ? Who are the big lenders or more popular lenders ? Any links or tool checkers ?All advice welcomed , Thank you , x

Aceace

Confused_landord said:

Hi , Everybody ,,, i have BTL's for a long time now ,but what i dont know  is how do i go about getting a mortgage on a commercial property ? Who are the big lenders or more popular lenders ? Any links or tool checkers ?All advice welcomed , Thank you , x

I don't know what they're like from a borrower's point of view, but I lend on commercial property through Proplend (https://www.proplend.com/). They seem professional enough from a lenders perspective. Might be worth a look. 

dunstonh

Confused_landord said:

Hi , Everybody ,,, i have BTL's for a long time now ,but what i dont know  is how do i go about getting a mortgage on a commercial property ? Who are the big lenders or more popular lenders ? Any links or tool checkers ?All advice welcomed , Thank you , x

You can start by posting on your own thread rather than hijacking someone else's on an unrelated subject and you could post it in the mortgage section.

csgohan4

Newlyboughthouse said:

If I could grab a non-snidey/snotty response that actually answers my original question (i.e. would you absorb the penalty as small change) that'd be great. I am working on plans to make the released funds work as hard as they can for me. It may be BTL. Just assume I'm going to invest wisely that'd help me loads - thanks.

OP if you want to only hear what you want want to hear, go for it, we are only trying to get you to see the other side of things. Don't be blinded by greed

London Capital finance are a prime example of people not wanting to hear the red flags and invested anyways, they lost alot of money

https://forums.moneysavingexpert.com/discussion/5346049/london-capital-and-finance/p1

Do your own impartial research, there's a reason why property is no longer the flavor of the decade

Most of us invest in diversified portfolio in our ISA's. My current performance excluding shares is about 10% and I started investing less than 6 months ago. Some of the more experienced investors have numbers pushing 50+%

Newlyboughthouse

Aceace said:

Newlyboughthouse said:

Hi all

I have a dilemma. I signed up for a 2 year remortgage fix at the start of November (too late to get out of cooling off period). I have an outstanding balance of £55,000 on my mortgage on a house worth around £280,000. 

I want to remortgage to release the equity to invest, however, the penalty is a psychological blocker for me (2%). So I would have to pay £1,100 penalty. Like most probably I am averse to paying avoidable charges, but I know obviously sometimes this is inevitable. The rate reduces to 1% penalty in year 2 of the fix.

What are your thoughts - is this small change, or would you wait, continue to aggressively pay down the outstanding balance to potentially get a lot more equity out in a year or 2?

You don't say how much of the equity you're planning to invest, but if its a large portion then yes it's small change. E.g. if you were planning on investing £150k then the fee only represents 0.7%. Personally, I don't have the balls to risk the equity in my home. 

My plan with the remortgage funds are to part put into property bonds, part buy a flip property, part buy a holiday home.

What do you guys think - would you think nothing of the penalty and do it now or wait?

The penalty wouldn't worry me. Putting too many eggs in a flip property or a holiday home would bother me. I prefer to diversify my investments over multiple properties (or other investments). If I had particularly strong and relevant skills that I could use to add value it might be different (builder, interior designer, etc). Sadly I don't, perhaps you do. 

Also, I'm not keen on the holiday home concept. My father bought a time-share and we soon got very bored with having to holiday in the same place to feel that we were getting value out of it. Each to his own though. 

Thanks

I've added my thoughts in bold above. 

That's good advice thank you.
I keep swaying to and from the holiday let idea.
I agree re: not putting all eggs in one basket.

Newlyboughthouse

csgohan4 said:

Newlyboughthouse said:

If I could grab a non-snidey/snotty response that actually answers my original question (i.e. would you absorb the penalty as small change) that'd be great. I am working on plans to make the released funds work as hard as they can for me. It may be BTL. Just assume I'm going to invest wisely that'd help me loads - thanks.

OP if you want to only hear what you want want to hear, go for it, we are only trying to get you to see the other side of things. Don't be blinded by greed

London Capital finance are a prime example of people not wanting to hear the red flags and invested anyways, they lost alot of money

https://forums.moneysavingexpert.com/discussion/5346049/london-capital-and-finance/p1

Do your own impartial research, there's a reason why property is no longer the flavor of the decade

Most of us invest in diversified portfolio in our ISA's. My current performance excluding shares is about 10% and I started investing less than 6 months ago. Some of the more experienced investors have numbers pushing 50+%

Thanks for this. I think I was possibly getting property bonds and REITS mixed up?
Good for you - that's amazing! I already invest in index tracker funds (which I began at the start of corona) so already seen healthy returns on those from buying cheap. Just wish I'd had more money to play with at the time.
I just want to take advantage of all this equity in my home and make it work for me!

Newlyboughthouse

Aceace said:

Newlyboughthouse said:

Hi all

I have a dilemma. I signed up for a 2 year remortgage fix at the start of November (too late to get out of cooling off period). I have an outstanding balance of £55,000 on my mortgage on a house worth around £280,000. 

I want to remortgage to release the equity to invest, however, the penalty is a psychological blocker for me (2%). So I would have to pay £1,100 penalty. Like most probably I am averse to paying avoidable charges, but I know obviously sometimes this is inevitable. The rate reduces to 1% penalty in year 2 of the fix.

What are your thoughts - is this small change, or would you wait, continue to aggressively pay down the outstanding balance to potentially get a lot more equity out in a year or 2?

You don't say how much of the equity you're planning to invest, but if its a large portion then yes it's small change. E.g. if you were planning on investing £150k then the fee only represents 0.7%. Personally, I don't have the balls to risk the equity in my home. 

My plan with the remortgage funds are to part put into property bonds, part buy a flip property, part buy a holiday home.

What do you guys think - would you think nothing of the penalty and do it now or wait?

The penalty wouldn't worry me. Putting too many eggs in a flip property or a holiday home would bother me. I prefer to diversify my investments over multiple properties (or other investments). If I had particularly strong and relevant skills that I could use to add value it might be different (builder, interior designer, etc). Sadly I don't, perhaps you do. 

Also, I'm not keen on the holiday home concept. My father bought a time-share and we soon got very bored with having to holiday in the same place to feel that we were getting value out of it. Each to his own though. 

Thanks

I've added my thoughts in bold above. 

This may sound naive (we all start somewhere) but with regards your comment about not having the balls to risk the equity in your home, What risks do you see? 

AlanP_2

Newlyboughthouse said:

Aceace said:

Newlyboughthouse said:

Hi all

I have a dilemma. I signed up for a 2 year remortgage fix at the start of November (too late to get out of cooling off period). I have an outstanding balance of £55,000 on my mortgage on a house worth around £280,000. 

I want to remortgage to release the equity to invest, however, the penalty is a psychological blocker for me (2%). So I would have to pay £1,100 penalty. Like most probably I am averse to paying avoidable charges, but I know obviously sometimes this is inevitable. The rate reduces to 1% penalty in year 2 of the fix.

What are your thoughts - is this small change, or would you wait, continue to aggressively pay down the outstanding balance to potentially get a lot more equity out in a year or 2?

You don't say how much of the equity you're planning to invest, but if its a large portion then yes it's small change. E.g. if you were planning on investing £150k then the fee only represents 0.7%. Personally, I don't have the balls to risk the equity in my home. 

My plan with the remortgage funds are to part put into property bonds, part buy a flip property, part buy a holiday home.

What do you guys think - would you think nothing of the penalty and do it now or wait?

The penalty wouldn't worry me. Putting too many eggs in a flip property or a holiday home would bother me. I prefer to diversify my investments over multiple properties (or other investments). If I had particularly strong and relevant skills that I could use to add value it might be different (builder, interior designer, etc). Sadly I don't, perhaps you do. 

Also, I'm not keen on the holiday home concept. My father bought a time-share and we soon got very bored with having to holiday in the same place to feel that we were getting value out of it. Each to his own though. 

Thanks

I've added my thoughts in bold above. 

This may sound naive (we all start somewhere) but with regards your comment about not having the balls to risk the equity in your home, What risks do you see? 

Losing your house!