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Paying inheritance off mortgage
mangomango
Posts: 28 Forumite
Hi
I've been lurking for a while and I'm a MFW. I'd be grateful for a few thoughts/ideas....
My partner and I are 28 and 29 and are due to receive upto £20,000 inheritance in the next few months. We would like to reduce our mortgage and ideally try to pay it off by age 40ish. It is currently £95,000 outstanding over 22 years. Our deal lets us overpay upto £499 a month and we are fixed at 6.05% for 5 years until May 2013.
Of the £20,000, we would like to put £5000 aside in savings leaving £15,000 for overpayments. I would like advice on the best way to do this i.e. put the £20,000 in one account to maximise interest and make 30 overpayments or put the £5000 into an ISA and keep the £15,000 separate for overpayments? or another thought..would it be worth keeping the £20,000 and switching to an offset mortgage once our fixed rate is up? we can make upto £150 a month overpayments from our own money until the fixed rate is up.
We don't have any debts apart from the mortgage.
Any advice much appreciated!
I've been lurking for a while and I'm a MFW. I'd be grateful for a few thoughts/ideas....
My partner and I are 28 and 29 and are due to receive upto £20,000 inheritance in the next few months. We would like to reduce our mortgage and ideally try to pay it off by age 40ish. It is currently £95,000 outstanding over 22 years. Our deal lets us overpay upto £499 a month and we are fixed at 6.05% for 5 years until May 2013.
Of the £20,000, we would like to put £5000 aside in savings leaving £15,000 for overpayments. I would like advice on the best way to do this i.e. put the £20,000 in one account to maximise interest and make 30 overpayments or put the £5000 into an ISA and keep the £15,000 separate for overpayments? or another thought..would it be worth keeping the £20,000 and switching to an offset mortgage once our fixed rate is up? we can make upto £150 a month overpayments from our own money until the fixed rate is up.
We don't have any debts apart from the mortgage.
Any advice much appreciated!
0
Comments
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Ask your mortgage provider how much you are allowed to pay as capital repayments each year first. A lot seem to say 10% per year which would be £9,500.The best bargains are priceless!!!!!!!!!! :T :T :T0
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Thanks Rebob, I will look into it.
So I may only be able to repay a max of £9500 a year inc overpayments?0
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