Is it worth payying a little bit more on my mortgage?

wbh1138 · 30 January 2009 at 11:23AM

Hi

as I have a tracker mortgage, the monthly payments have come down about £75 over the last 6 months.

My question is, is it worth paying the amount I was paying, to nibble away at my mortgage (mortgage is only around £35000 with just over 10 years to go) or will it make so little difference that I may as well spend it and enjoy it now.

I look forward to any advice.

Cheers
Wayne

_Andy_ · 30 January 2009 at 11:24AM

Yes it is.

druss · 30 January 2009 at 11:28AM

It is worth paying extra, however in the current climate 'Cash is King'

If you have little or no savings I would build this up first so you have money to fall back on if life takes an unexpected turn.

It is much harder and more costly to get money out of a property than to pay it in and if life takes a down turn then its at this point the banks would probably say no to any further borrowing.

If you have enough to fall back on then yes pay in the extra, it will nibble away and save you money on interest repayements, just check you are able to do so without incurring penalties.

regards D

wbh1138 · 30 January 2009 at 11:32AM

Cheers for that.

Another option was to put the money in with my savings to cover when it goes up.

Wayne

rattla · 30 January 2009 at 11:37AM

wbh1138 wrote: »

Cheers for that.

Another option was to put the money in with my savings to cover when it goes up.

Wayne

No point putting it in your savings, especuially as most places let you withdraw your overpayments if you want to - get that mortgage paid off and save that interest.

tanith · 30 January 2009 at 11:42AM

When I suggested overpaying to my OH his words were 'well if one of us 'carks' it in the meantime (before the mortgage is paid off) the Life Insurance company won't have to pay as much out as we will of saved them the money by overpaying', I did laugh but does he actually have a point? Incidentally I do overpay a little if I have anything spare ...ssshhhhhhhhh!!! but actually I wonder wether he is right and I am wrong?

edit: to say we only have a small mortgage that finishes in around 6 yrs anyway

SandC · 30 January 2009 at 11:44AM

No really cos at the time of a bereavement of your other half you won't be sitting there wishing that you hadn't bothered paying a bit more off your mortgage!

beecher · 30 January 2009 at 11:45AM

You could open a Web Saver account and put the savings in - one you can't touch for 9months or so might be good as the interest might be higher than you are paying on your mortgage Then make one capital repayment at the end. That's what I'm doing at least.

blued · 30 January 2009 at 11:49AM

The goverment wants you to spend it to bring us out of the recession.

I'd be overpaying though, whatever the rate drops to!

Robert_Sterling_3 · 30 January 2009 at 12:06PM

tanith wrote: »

Life Insurance company won't have to pay as much out as we will of saved them the money by overpaying', I did laugh but does he actually have a point?

The short answer is that he is abolutely wrong.
Even if you pay off your mortgage 15 years early your life insurance has a life of its own. It will pay out an "appropriate" amount on your death.

tanith · 30 January 2009 at 12:18PM

Robert_Sterling wrote: »

The short answer is that he is abolutely wrong.
Even if you pay off your mortgage 15 years early your life insurance has a life of its own. It will pay out an "appropriate" amount on your death.

Sorry I actually meant the Mortgage Protection Policy , it a reducing term one..

Is it worth payying a little bit more on my mortgage?

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