Anon4this1
New Member
- Messages
- 3
Long story short....
c.€400k inheritance (after tax is paid)
Primary residence - c.€260k mortgage balance, with €1,200 p/m repayments (1.5% interest rate)
Rental property - c. €130k mortgage balance, with €650 p/m repayments (1.25% interest rate) and €1.1k monthly rent (way below market value, but not a lot I can do about that unfortunately )
I love the idea of being mortgage free on my primary residence, but €260k out of €400k is a very significant chunk, so I am most drawn to clearing the rental property, leaving a larger chunk, securing a larger income, and creating an asset I can sell, if I ever met hard times.
I was originally thinking about locking in €120k for 10 years in the National Solidarity Bond (via An Post), as it is very secure and a 10% guaranteed rate of interest, which is one of the best around for a 'safe' investment from what I can see. However in reality the return on this investment after 10 years is just €12k
If I use €130k to clear my rental mortgage I am securing the €130k in a property which is currently worth €215k, and I could sell if needed, plus I would earn (pre-tax) the same additional income in 18 months, than I would in 10 years via the Bond.
However I am conscious I might be missing something here., especially with the very low rate of interest I am currently paying... what would people's view be on my situation.
c.€400k inheritance (after tax is paid)
Primary residence - c.€260k mortgage balance, with €1,200 p/m repayments (1.5% interest rate)
Rental property - c. €130k mortgage balance, with €650 p/m repayments (1.25% interest rate) and €1.1k monthly rent (way below market value, but not a lot I can do about that unfortunately )
I love the idea of being mortgage free on my primary residence, but €260k out of €400k is a very significant chunk, so I am most drawn to clearing the rental property, leaving a larger chunk, securing a larger income, and creating an asset I can sell, if I ever met hard times.
I was originally thinking about locking in €120k for 10 years in the National Solidarity Bond (via An Post), as it is very secure and a 10% guaranteed rate of interest, which is one of the best around for a 'safe' investment from what I can see. However in reality the return on this investment after 10 years is just €12k
If I use €130k to clear my rental mortgage I am securing the €130k in a property which is currently worth €215k, and I could sell if needed, plus I would earn (pre-tax) the same additional income in 18 months, than I would in 10 years via the Bond.
However I am conscious I might be missing something here., especially with the very low rate of interest I am currently paying... what would people's view be on my situation.