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HELP , what's the best move forward as an investor ?


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Hi , looking for advice .  I am about to buy my first buy to let property I have three choices of interest rate . 

1/ 2.73% with an arrangement fee £1995 making monthly payment £234.88

2/ 2.89% with an arrangement fee of £ 995 making a monthly payment of £246.24 

3/ 3.05% with no arrangement fee making a monthly payment of £257.34

 

 As an arrangement fee can be offset against tax is it better for me to pay that upfront ,offsetting it this tax year and earning more profit ,or am I better to go for the overall cheaper option number 3?

 

 I am just starting to get used to thinking like an investor rather than a home owner who of course would go for the overall cheaper option the mortgage I have will be interest only in this case so surely cash flow is best .

 

 

please help 

 

newbie ruth !

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You need help from 2 people, 1 a mortgage broker who will work out total cost of the rate and fee over a set period of time, thus giving you the cheaper option over a set period of time, and then an accountant/tax advisor who can advise the most tax efficient option.

Wesley Davidson

 

Director & mortgage broker

 

T

01179 897 950

M

07967 033 452

E

wesley@foxdavidson.co.uk

W

foxdavidson.co.uk

 

 

 foxx.png

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Hi Ruth,

 

How long is your deal fixed for and what are your intentions for when that deal ends? Will you move to another provider? 

If you have a 2-year fix for example and difference between 1&3 is £539.04 but then you're paying £1995 arrangement fee it wouldn't stack up based on that, there are other factors which need to be considered mainly around your tax status and future intentions.

 

Hope this helps

 

Greg

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