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To pay off BtL mortgages or not

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Looking for some advice, please. 

Our London (residential) house: worth 800K,  300K mortgage remaining. 
Two BtL properties: Manchester, worth 140K, 90K mortgage, London, worth 400K, 280K mortgage. Both rented out achieving decent yields.

An inheritance coming my way means I'm considering paying off our residential mortgage (I'm 55) and either paying off one of the BtL properties or buying another BtL.

I guess my question is around the idea of paying off BtL portages; smart or daft, please?

Thanks in advance for any thoughts/advice or insights.

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I guess it's a question of maths / economics over emotion.  The figures will almost certainly suggest further investment is better in the long run - but if your peace of mind wants you mortgage free asap then go for that.  You also need to factor in whether you intend to keep working or would want to replace your income with rental income (in which case investing will almost certainly be better).


As Rob and Rob love to say - work out your goals! 




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I'd look at cash flows.

In the scenario where you have paid off the mortgage on your home, you may have drastically reduced the amount of money that you need to live off every month. If you wanted to retire, do cash flows from the other two properties and any other income (pensions etc.) sustain you?

Do you want to keep working? You need to presumably pay of the BTL mortgages at some point so if you go and invest instead of paying them off, what's your plan to pay them off?


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I would say you do not presumably need to pay off the BTL mortgages at some point. If the rental is more than covering the mortgage payments then you may choose to never pay of the mortgage. But it depends on your goals, financial plans, cashflow requirements, etc. as everyone else says.

I have decided for now that I will keep my LTV what it is and reinvest profits/refinanced equity to keep building my portfolio. But I am not planning to replace my income or retire any time soon, so this works for me.

Do the maths, work out what paying off some of the mortgage would mean and if it fits in with your plans, or if actually growing your portfolio is priority for now.

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