I obviously can't predict future property prices but if I was in your shoes I would definitely sell the rental and apply the freed up cash flow to pay down the mortgage on your PPR as aggressively as possible. It's not even close – no reasonable risk/reward analysis could justify retaining the rental on those numbers.
Once you have developed some decent equity in your PPR you should definitely look to switch to another lender to get a more reasonable rate.
Will you need to use your €40k savings to make up the difference between the anticipated sales price for the rental and the outstanding mortgage? If not, you really shouldn't have that much on deposit earning a minimal return while carrying mortgage debt @4.5%.
What is the amount outstanding now
We expect to sell at 180-185k thereby covering mortgage in full and extra cost for solicitor.
Outstanding amount is 179kSo the original mortgage was for €225,000. What is the amount outstanding now, just so it's clear for people.
Thanks Brendan, that makes sense. Had the 40k as a fund for kids college and nervous to throw it all in to mortgageOutstanding amount is 179k
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