help should i pay it off

markbsac

simple maths but need help

3 years left on endowments

£34,00 left on mortgage

£23,00 in endowments

i have £11,000 in cash to pay it off if i want to

what would you all do ?

mark

NoobySaver

Hi Mark. To give a more reasoned answer you will need to give a little more information.

It would be useful to know what sort of endowments you have (if with profits are you expecting a reasonable terminal bonus for instance, or are there penalties for cashing in at this point), whether you are a HRT payer, if your £11,000 savings is all your savings or if you have other set aside for a rainy day, what interest rate you are paying on your mortgage, if there are any penalties from your mortgage provider in paying it off early and I think that would be it.

Give me those details and I will give you what I would do in your situation but regardless it sounds like you are in an enviable position! :T

markbsac

NoobySaver wrote: »

Hi Mark. To give a more reasoned answer you will need to give a little more information.

It would be useful to know what sort of endowments you have (if with profits are you expecting a reasonable terminal bonus for instance, or are there penalties for cashing in at this point), whether you are a HRT payer, if your £11,000 savings is all your savings or if you have other set aside for a rainy day, what interest rate you are paying on your mortgage, if there are any penalties from your mortgage provider in paying it off early and I think that would be it.

Give me those details and I will give you what I would do in your situation but regardless it sounds like you are in an enviable position! :T

one with proffits with over 12,000 in it the other one is the other type just over 11,000 in it..no penalties from either endowments or mortgage i am on low variable rate cant put my hands on exactly what rate...not a HRT payer...i have the £11,000 in spare cash to pay it off...many thanks mark

lilac_lady

Pay it off and build your savings up again. Great to be mortgage free.

mcjordi

i would pay off the morgage personally then pay what you would have been paying in morgage repayments into a high interest savings account safe in the knowledge that you have no morgage to worry about should any thing happen ie losing job

markbsac

mcjordi wrote: »

i would pay off the morgage personally then pay what you would have been paying in morgage repayments into a high interest savings account safe in the knowledge that you have no morgage to worry about should any thing happen ie losing job

yes my this is what i have been thinking..i had over 12,000 in both endowments but standard life reduced one by over £1,000 as people were cashing there policies in, so they did this to prevent more people cashing in saying they can take the bonus off whenever they feel like it........so we get penalised for leaving them up and running...i was discusted by this but nothing i can do about it

NoobySaver

markbsac wrote: »

yes my this is what i have been thinking..i had over 12,000 in both endowments but standard life reduced one by over £1,000 as people were cashing there policies in, so they did this to prevent more people cashing in saying they can take the bonus off whenever they feel like it........so we get penalised for leaving them up and running...i was discusted by this but nothing i can do about it

This was my fear on a with profits endowment. They have not removed your bonus but applied a charge if you encash it early (they may cancel one another out but that would be coincidence only). However, they cannot apply that charge on maturity so for that particular one it may well be best to keep it running until the maturity date.

NoobySaver

Should have also said in my post above that if you are now on a low variable then, depending on your savings interest rate, you may be better off having the savings. If your savings rates are fixed and the professionals out there are correct in their thinking that interest rates will fall further then you would be definately better off keeping them as savings. Factors to consider are where your savings are, their tax position and the interest rate over your mortgage interest rate along with the providers history in reducing their SVR on an interest rate cut. However, overiding all that is the satisfaction of having no mortgage but at least you now have some figures and facts to make a more informed decision.

markbsac

hi again people i have just found out what my interest is on my mortgage...4.79% which is a lot more than anything i have in a savings account...so i suppose that has answered my question...pay it off ?

sirholidayalot

really depends if you wish to pay off your mortgage because if you want to upsize in the future even if you only have say £20k left its worth it as your chances of getting a mortgage ironically are better than if you are mortgage free.
lenders like to see a history of being able to pay debt and if you have been mortgage free for years they have less of an idea of your ability to do that.
however if you have no wish to move in the future then sure paying off the mortgage totally is certainly not a bad thing.

markbsac

hi there i have been told to leave a small amount in, say £500 or even less for exactly the same reason you state..we may move on but my idea is to save all that i pay out at the moment plus the 250 i already save in a SAYE that soon has to stop so i will pay almost all of my mortgage off and reinvest each month into a good account (thats another story) about £800 a month.

im thinking that this will be the best bet as i wont have a mortgage cant get re-posesed if i loose my job and save for if the economy turns around again.

many thanks for all of your help with my question you hav all been of great help.

mark