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The Property Podcast

ASK270: How do you repay an interest-only mortgage? PLUS: Is a periodic or fixed-term contract better?

The Property Podcast

Rob Bence & Rob Dix

Business News, Education, News, Investing, Business

4.82K Ratings

🗓️ 2 February 2021

⏱️ 10 minutes

🧾️ Download transcript

Summary

This week on Ask Rob & Rob we’ve got a question on mortgages and another question on tenancy agreements..  Our first mortgage related question comes from Martin in Ireland.  Martin is wanting a bit of advice on interest-only mortgages. He’s looking to purchase his first property with an interest-only mortgage as he knows he’ll have more of a monthly rental income.  However, he’s a bit unsure as to how he actually pays that loan back in the long-term, say 20-25 years down the line.  Ideally he would like to allow his rental income to accumulate so that he can purchase a second property and keep that cycle going to build up a portfolio.  But he’s concerned that when it comes down to it, he’ll have several mortgages he’ll need to pay off and isn’t sure how he’ll do it.  Next we’ve got Luke who’s in Hong Kong! He’s just about to complete on his third buy-to-let property in the UK and is wanting some advice on tenancy agreements. Luke wants to know if after a fixed-term contract is up, should he allow the tenancy agreement to roll over to a periodic tenancy, or should he renew the fixed-term contracts every time?  He’s wondering if there are pros and cons to both or if one is better than the other. Tune in to find out.   Do you have a buy to let or property investment related question for Rob & Rob? You could feature on the next episode by giving us a call on 013 808 00035 and leaving a message with your name and question (normal UK call rates apply).  Or if you prefer, click here to leave a recording via your computer instead. The next question on Ask Rob & Rob could be yours.  Have you joined us over on the Property Hub Forum yet? Our online community is friendly, informative, and the members are waiting to welcome you with open arms. So get yourself over and introduce yourself. See omnystudio.com/listener for privacy information.

Transcript

Click on a timestamp to play from that location

0:00.0

Hi, I'm Rob. And I'm Rob. And this is Ask Rob and Rob.

0:05.8

Welcome to Ask Rob and Rob. Yes, it's Tuesday and that means we are here to answer two of your property questions.

0:14.0

Answers coming up in just a sec for Martin and Luke, but first a quick reminder of how you can get your own question in.

0:19.2

Yeah, you can call in on 113-008-O-3.5, that number's been around for a long time now.

0:26.0

I'm sure you've got it saved.

0:27.0

And I'm sure you've got this website saved as well.

0:29.4

Property Hub.net.

0:31.0

forward slash ask. Either way, it's super easy to get involved, leave a message,

0:36.0

it's a voicemail on the phone, it's a similar on the computer,

0:39.0

and if you mess up you can try again, so you've got no excuses.

0:42.0

And this week we've had two people follow

0:44.2

that process to a T let's start with Martin.

0:48.0

Hi guys my name's Martin I'm from. I've recently started listening to the podcast

0:53.3

and I'm finding it very useful indeed, very educational

0:55.9

as somebody who's looking to get involved in property

0:58.1

investment over the next few years.

1:00.0

So I've just a quick question for you guys

1:01.8

in relation to interest-only mortgages. So I'm have a quick question for you guys in relation to interest only mortgages.

1:04.1

So I'm looking at taking out an interest only mortgage to buy my first property and it'll be great because I'll have

1:09.3

more rental income coming in every month then as opposed to taking out a capital repayment mortgage.

1:14.4

However, one thing that I'm not too sure about is when it comes to the end of the mortgage term

1:18.8

and I have to repay the outstanding loan, I'm wondering how well managed to have funds to pay for that.

...

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