Morgage payments in advance.

dachse

I have been made redundant and am wondering whether I could use my redundancy money to prepay 1, 2 or even 3 years worth of payments on my mortgage. By doing this then my monthly outgoings are obviously reduced.

I have a 15 yr tracker with the Woolwich and current balance approx. £75,000. My monthly payemnts are £311 at the moment so 1 years worth would be £3732.

Any suggestions would be appreciated.
Thanks.

Dave

Rednoseranter

You may have an early repayment charge attached to your mortgage product, so yuo may incur penalties for making this lump sum payment. However making this lump sum payment will not mean you can stop paying your mortgage for 1, 2 or 3 years. They will still expect you to carry on paying your normal monthly payment after making the lump sum payment.

PBA

Unless you have a flexible mortgage it's unlikely that they'd let you not pay for several months/years, even if you had made a substantial overpayment. You could always set up a 2nd current account with this lump sum in it and have your morgage DDs collected from it if keeping the money separate is important to you.

dimbo61

You dont mention the interest rate on your tracker but I hope its low.
Keep to your normal monthly payment and try and get the best rate you can from your savings as this will help with the mortgage payments.
When you get another job you could then use some or all the savings to pay a large part of your mortgage off.
Always keep 3/6/9 months worth of income in savings as an emergency fund
GOOD