Raising Capital or Retaining Cashflow on a Bank Base Rate Tracker

by Readers Question

12:18 PM, 4th June 2014
About 7 years ago

Raising Capital or Retaining Cashflow on a Bank Base Rate Tracker

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Raising Capital or Retaining Cashflow on a Bank Base Rate Tracker

Wrestling with a common dilemma whether to sell a good cashflowing flat on a low rate BoE tracker or sell to raise capital to reduce some unsecured debt and invest in another property.

Selling will raise £60K whereas the cashflow is c.6.5k pa. but a lease extension will be required in about 5 years which will have a capital cost and reduce appeal of the property unless extension is obtained. CGT will be minimal.

I feel rather reluctant to let go of the BoE tracker at 1.99% above base as such products are unlikely to be sourced in the future and are obviously ultra competitive to help rental cashflow.

Comments and observations welcome please.

Lord Smythescales


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Comments

Mark Alexander

9:40 AM, 9th June 2014
About 7 years ago

Reply to the comment left by "Lord Smythe" at "09/06/2014 - 09:04":

MX standard policy is not to agree to second charges, however, if they are ordered to by the FOS they have no choice in the matter, the Ombudsman's decision on what's fair and what's not fair is on a case by case basis and is binding in absolute upon the mortgage lender. Please let me know how you get on.
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