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    • first78
    • By first78 11th Oct 16, 4:10 PM
    • 706Posts
    • 350Thanks
    first78
    Will overpaying make much difference?
    • #1
    • 11th Oct 16, 4:10 PM
    Will overpaying make much difference? 11th Oct 16 at 4:10 PM
    I really hope this isn't a silly question....I really don't understand much about mortgages!

    We have just taken out a 2 year fixed rate on our existing property: we owe £61,511 and are paying £265 per month at an interest rate of 2.73%.

    We have a remaining term of 27yrs and 7 months. In 2 years time we want to move to a bigger house, better area. We are now in a position where we have around £300-500 per month that we could overpay on the mortgage. What I want to know is whether this would make much of a difference over that 2 years?
Page 1
    • Tropically
    • By Tropically 11th Oct 16, 4:17 PM
    • 51 Posts
    • 152 Thanks
    Tropically
    • #2
    • 11th Oct 16, 4:17 PM
    • #2
    • 11th Oct 16, 4:17 PM
    You are in luck: http://www.moneysavingexpert.com/mortgages/mortgage-overpayment-calculator

    You will pay off your mortgage 19 years and 7 months earlier. In 7 years instead of 27, so yea I would say it makes a big difference.
    • socks779
    • By socks779 11th Oct 16, 4:46 PM
    • 7 Posts
    • 12 Thanks
    socks779
    • #3
    • 11th Oct 16, 4:46 PM
    • #3
    • 11th Oct 16, 4:46 PM
    Make sure there are no early repayment charges first though as this could be costly. Good luck
    • first78
    • By first78 11th Oct 16, 5:46 PM
    • 706 Posts
    • 350 Thanks
    first78
    • #4
    • 11th Oct 16, 5:46 PM
    • #4
    • 11th Oct 16, 5:46 PM
    Make sure there are no early repayment charges first though as this could be costly. Good luck
    Originally posted by socks779
    We can pay off 10% of the outstanding balance per year and will move in 2-3 years which will be before the mortgage is paid off.
    • A Frayed Knot
    • By A Frayed Knot 11th Oct 16, 9:12 PM
    • 1,742 Posts
    • 7,993 Thanks
    A Frayed Knot
    • #5
    • 11th Oct 16, 9:12 PM
    • #5
    • 11th Oct 16, 9:12 PM
    Paying nowt you would owe £58,149.49 after 2 years
    • o/p £300 per month, you would owe £50,440
    • o/p £400 per month, you would owe £47,871.21
    • o/p £500 per month, you would owe £45,301.64
    You decide, here's the addictive calculator http://www.whatsthecost.com/snowball.aspx
    Always have 00.00 at the end of your mortgage balance and someday it will all be 0's
    MFMarch 30 Re/M Oct 23 Target -Dec 19
    o/p 2014/£4000, 2015/£6294.69 MFW2016 #27 £3101.03/£3000
    £1000/£1000 51.44/33.29=84.73
    • tootallulah
    • By tootallulah 12th Oct 16, 7:08 AM
    • 1,935 Posts
    • 6,684 Thanks
    tootallulah
    • #6
    • 12th Oct 16, 7:08 AM
    • #6
    • 12th Oct 16, 7:08 AM
    I would pay off the 10% every year and put the rest in an ISA. It will put you in a great position when you are ready to move. And make sure your next mortgage allows unlimited overpayments!
    Mortgage House £173,000 July17th 2016.
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