Hi
I have an “investment” property (former home) and I’ve been debating paying a lump sum off the mortgage.
I pay approx. €12,000 interest per year on the repayments, 75% of which is tax deductible against rental income.
Is it too simplistic to think that by reducing my interest bill I’ll pay more tax on rental income and so better to pay lump sum off home mortgage?
I have a very small mortgage on my new home and low loan to value. Would it make more sense to pay down home mortgage or try reduce LTV on the investment property?
The numbers are:
Investment Property
·Loan balance €320k @3.8% 20 years remaining rent received €1650 per month
·Value, approx. €360k
Home
·Loan balance €150k @3.65% 24 years remaining
·Value circa €450k
Thanks
I have an “investment” property (former home) and I’ve been debating paying a lump sum off the mortgage.
I pay approx. €12,000 interest per year on the repayments, 75% of which is tax deductible against rental income.
Is it too simplistic to think that by reducing my interest bill I’ll pay more tax on rental income and so better to pay lump sum off home mortgage?
I have a very small mortgage on my new home and low loan to value. Would it make more sense to pay down home mortgage or try reduce LTV on the investment property?
The numbers are:
Investment Property
·Loan balance €320k @3.8% 20 years remaining rent received €1650 per month
·Value, approx. €360k
Home
·Loan balance €150k @3.65% 24 years remaining
·Value circa €450k
Thanks