Interest Only Mortgage - Regular Savings

opinions4u

Ultimately, banks exist to make profits (in normal market conditions) because they pay less interest to savers than they charge borrowers.

While there may occasionally be an opportunity to exploit a market leading rate, it is highly unlikely that this can be sustained profitably over two decades, even with good management and chasing the top rates.

If you can invest at 7% now, you need to have a mortgage rate of less than 5.6% to make a profit. 4.2% for a higher rate taxpayer.

Nice thought. Won't work for the term of the mortgage though. Banks exist to make profit!

getmore4less

When your ability to repay a mortgage is marginal, Ie. all you would be saving is the capital repayments anyway and your max savings without a mortgage are not much more than the IAS allowance pay off the mortgage first

When you get down to lower debt numbers(£50k) or your savings ability increases it will be worth a review and considering ISAs for the longer term.

Saving where you expect to use ALL the capital to pay off debt is too marginal to be worth the hastle.

The serious problem you currently have is no emergency/disaster fund which needs addresing, if you realy cannot save any more with cut backs elswhere then going I/O to build up an emergency fund is an option.

Simon_Pugsley

Ah well, just thought I would ask, but it looks like it wont be possible.

Thanks for all your posts guys..

Simon