Mortgage or savings? What should we do?

Entrepreneur_en_faillite

Andyboy.....

Firstly - you lucky so and so! i am soooooo jealous and I admire you for your care over your finances.

Secondly - find out form your motgage lender if you can make an overpayment without incurring a redemption penalty, and if they would allow you to redraw the funds in the future if you need to access them. If they say yes then repay all but a couple of thousand on your mortgage. if they say no, remortgage the whole lot to a new lender who will allow you to make overpayments and then redraw later, once the mortgage completes, repay all but a couple of thousand - Easy!

Hope this helps you.

Eef

pickle

This might be a crazy idea so be careful - depending how much you have to pay off the mortgage could you get a 0% credit card and borrow the money for 12 months interest free and then pay the mortgage off, so you save on mortgage interest. Then you have a further 12 months to save up a bit more money (adding the mortgage interest along the way) and then maybe pay off the credit card in full at the end of the year and have the extra savings you've made for the rainy day.

Andyboy

BobProperty wrote:

You are extremely unlikely to get as much or more post tax interest on savings than you will pay in mortgage interest. Therefore pay it off. How much "rainy day" money do you expect to need? Surely without a mortgage you can build a fund in a matter of months?
And can you explain "making use of our tax free alowances" please, there aren't too many of them when it comes to mortgages.

By tax allowances I meant ISAs really. Thanks for info.
:beer: