Property question - what would you do?

[RosieLeaLovesTea]

Ok so here goes:

1. We live in house A - 4 bed, 3 bath semi detached. It’s my house that I owned before I met my DH. We have renovated it and added a loft conversion to get the 4 th bed. He works at home self employed so one bedroom is an office. I am currently over paying on the mortgage to pay it off in 10 years time. I love where we live and the area. The only downside it’s a semi.

2. I have a rental property which is let to tenants. There is only approx £60,000 left to pay off but it will take until I’m 58 with normal mortgage payments.

3. DH and I have been talking about buying our forever home. Moving more rural and into the country. No immediate neighbours.
   In about 2 years he will have additional income from rental property oversees which is being built at the moment. So we should have more money to buy a better house.

If we move again I would like to keep the house we are living in to rent rather than sell.

So do I:

A) continue to overpay on mortgage on house we live in to proceed with plan of paying it off in 10 yrs. I would be mortgage free on that one At 53 yrs.

B) save the money overpaying towards deposit for new house.

C) borrow more on the buy to let to have more deposit for the bigger house and extend the term of that mortgage.

I think we need at least £100,000 for the deposit.

What would you do?

This is impossible to answer without knowing the interest rate % on where you’d put your savings, the mortgage on where you live and the BTL mortgage. Put the money where you earn the most whether that’s by growth on savings or saving interest on mortgage payments.

If you’re saying you can’t do what you want to without the 100k cash then save it to follow your plans. But sounds like you could remortgage when time came to purchase to release equity? In the run up, I’d go with above re interest rates.

Yes I was originally thinking of overpaying on the mortgage. To pay it off fully. But then we started talking about moving. We have everything we need in our house at the mo apart from a driver for several cars and a garage. But we have a big garden.

I had thought of borrowing on the mortgage we are overpaying on to release equity. But I could also do that on the buy to let.

Either way if both houses are rented I think we will still be making more that the mortgage costs.

If we do move I have to accept that I am going to have a mortgage until I retire. My original plan was to be mortgage free at 53 and 58 when both mortgages we paid off.

By then I think that perhaps we should use the equity to allow us to move.

overpay on the mortgage for now. you can always borrow more if you need to later for the new purchase.