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U2, Part B: Femi, Spreading Risk, image - Coggle Diagram
U2, Part B: Femi
Int. only mortgage deals comparison!
Bath BS
Clydesdale Bank
Monmouthshire BS
Femi: Risk Neutral Attitude, shows risk averse behaviour BUT takes out mortgage...
Spreads risk on her current renting by splitting house.
Probably because she have a family, & middle/late-middle aged
Splitting did & will involve more costs.
Also she chose to save from her other rental income for 3 years
BTL to rent out
To convert into studio flats to rent out
BTL: interest-only
Femi is Risk Averse: consider to save from other renting incomes to pay the capital sum off when term ends for interest-only BTL mortgage
Deposit BTL by saved renting incomes from other studios
14400 per year x 3 = £43200 gross from savings
amount after tax to use as potential deposit for BTL so on average £40000 for deposit
May need to increase her mortgage if possible to split the property into studio flats as planned
She may consider talk to a mortgage broker to find a good BTL mortgaging deals, potential cheaper ones, HOWEVER involves some cost but should be worth it for her situation
F E M I
Actuary: £65k annual salary = she earns good money
From both her salary (due experience - 'fully qualifies') & fact that she have kids
Leads us to assume she is middle or late middle aged
PROPERTIES: An inherited house from her mum which she converted into studio flats & her own house which she paid mortgage off recently from her mums savings
Planning to buy another house through BTL mortgage where she wants to split into studio flats like the other house she rents
We can assume & say that she potentially should have a good credit score, due financial footprint, traced to see her past mortgage repayment history
lives in Kent travels to Office in London daily - travel costs
She is an 'Actuary' her profession is based on measuring & managing risk, she has some type of financial knowledge to help her making decisions
Spreading Risk
