Which mortgage to pay off?

spannerj

I have two mortgages on my property with £69k and £79k outstanding. Both are repayment with an interest rate of 5.83%.

I play a little poker and do OK, so I have decided to use some of my profits (£100) each month to reduce the debt. I was just wondering if it mattered which of the two balances I overpaid on? Would there be a benefit paying one instead of the other or does the fact that they are both the same interest rate mean it's not important?

Thanks for any advice.

wymondham

I'd hazzard a guess do the larger one first?

happybroker

if they are both accruing interest at the same rate it makes no odds which one you over pay on.

bluffer

which one allows you to overpay? Which one takes the overpayment into account and takes it off the balance immediately instead of at the end of the year?

happybroker

bluffer wrote: »

which one allows you to overpay? Which one takes the overpayment into account and takes it off the balance immediately instead of at the end of the year?

it's a fair point bluffer, given the interest rates are exactly the same, that both mortgages have the same T&C's

spannerj

Cheers for the replies.

Both mortgages are the same T & C's.

One was a mortgage on my last house and when I moved here I took a further advance. When I remortgaged this year for some reason they wouldn't let me consolidate the two into one large sum so I have 2 mortgages on the same T & C's. They are both flexible and I am able to overpay up to £500 on each product in a calendar month.

I knocked up a quick spreadsheet and worked out that it makes no difference which I pay off first but I'm going to go for the smaller product just so that I can clear it quicker.

Thanks again.