T
TomP1975
Guest
Hi, I am about to buy and live in a property. I was ready to go with an interest plus capital mortgage repayment until i spoke with another mortgage broker.
He suggested that as I only plan to live in this property for about 3 years and then either sell or rent it - i should consider and interest only mortgage from the outset where i can maximise my tax write-off on interest repayments when i start renting it.
I'm pretty new to this and still am confused. Is there much of a difference between the tax treatment on the interest paid between these two mortgage types? If i were to go with a capital & interest repayment mortgage and then rent it out in 3 or so years - would i be losing out?
How is interest (for tax purposes on rental income) calculated on a capital & interest repayment mortgage?
He also stated that the difference on the monthly repayments (between interest only and capital + interest) can be used to save for a deposit on a new property - which does appeal to me as this is what i would like to do in 3 yrs. However, i'm unsure as to what kind of a yearly saving i can expect on say 100K mortgage for example
I've been looking at the revenue site to try and understand it more but what i really need is an applied example - could anyone oblige?
Thanks in advance
He suggested that as I only plan to live in this property for about 3 years and then either sell or rent it - i should consider and interest only mortgage from the outset where i can maximise my tax write-off on interest repayments when i start renting it.
I'm pretty new to this and still am confused. Is there much of a difference between the tax treatment on the interest paid between these two mortgage types? If i were to go with a capital & interest repayment mortgage and then rent it out in 3 or so years - would i be losing out?
How is interest (for tax purposes on rental income) calculated on a capital & interest repayment mortgage?
He also stated that the difference on the monthly repayments (between interest only and capital + interest) can be used to save for a deposit on a new property - which does appeal to me as this is what i would like to do in 3 yrs. However, i'm unsure as to what kind of a yearly saving i can expect on say 100K mortgage for example
I've been looking at the revenue site to try and understand it more but what i really need is an applied example - could anyone oblige?
Thanks in advance