2nd opinion please

expatinbermuda

I have an interest only Mortgage with the Halifax and an Endowment with Zurich.

The endowment is forecasting only a 50% return, and still has about 10 years to run.

The mortgage is small :beer: to many on here and is only $45,000. Advice given so far is not to cash in the endowment and remortgage as it will be money down the drain.

The house value exceeds the mortgage value by a factor of two, so I am not unduly concerned (at the moment) about negative equity as if worst came to worst I could easily sell the house and clear my debts. I don't want to sell the house and that would be a last resort.

As there are no penalties for early repayment of the mortgage would I be correct in thinking that by making additional payments to the Halifax and therefore reducing the capital and consequently the interest, that this would be best option? I am thinking of starting at paying an additional 200 pounds (sorry no pound signs over here) a month based, on what I am "saving" due to the drop in interest rates and what I can potentially afford in the future.

Any advice/criticisms greatly appreciated.

Rednoseranter

Sounds sensible - your going to have to make arrangements meet the shortfall on the mortgage because of the endowment in any case. Have you made a complaint about the sale of the endowment - I assume that you were told its was "guaranteed" to repay the loan amount and return a bonus?

Comyface

I agree, that's what I'd do too.