We'd like to remind Forumites to please avoid political debate on the Forum... Read More »
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
Save or Pay Off Mortgage? Please Help!
Zero7_2
Posts: 6 Forumite
Hi,
We are in a bit of a dilema, and I'm in desperate need of advice. I'll try and keep it fairly simple.
We have a £220k Interest only mortgage on our house which is valued at £430k. We purchased this house with a view to selling on within a 1.5 years, (hence the interest only mortgage which was fixed at 4.95% for 2 years) however our circumstances have changed and we want to stay in this house for at least 7-10 years.
We are both in a our mid 30's and I work as a contracotr and earn over £100 per year, my wife earns £25k, we eat well and spend money on things we like.
Our interest only mortgage has come to the end of 2 year deal and now we are paying an extra £120 per month as it has gone over bae rate.
We have around £20k in a high interest account and around £13k in Cash and Stocks and Shares ISA's with the Halifax.
We decided to get a repayment mortage and use these savings to pay off some of the capital, i.e. borrow £190k as a repayment mortgage.
We could also afford to pay of large chunks every 6 months or so, perhaps £10 every 6 months.
I decided to have a meeting with my financial advisor from Halifax and spent 3 hours with him yesterday, his thought process was totally different to mine. He said that I should stick to a repayment mortgage and put my extra money and monthly payments into topping up our ISA's and then take out some further investments (CIP) and make my money work for me at a much higher rate of interest than what I would be paying on my borrowings.
Our Cash ISA's have grown an average of 19% year on year over the last two years, O.K, they are classed as high risk but only 20% is in the far east.
Our ultimate goal is to be Mortgage free in about 5-7 years, with the money coming in and spending a little less (we have everything we need in life) I think this is possible, however my mind keeps saying just pay chunks of the mortgage, £10k here and £10k there.
But the saving options seems more tempting, which way will I pay my mortgage off quicker? In fact, do I need to pay my mortgage off at all if my income could earn my a massive high rate of interest?
Please help!!!
We are in a bit of a dilema, and I'm in desperate need of advice. I'll try and keep it fairly simple.
We have a £220k Interest only mortgage on our house which is valued at £430k. We purchased this house with a view to selling on within a 1.5 years, (hence the interest only mortgage which was fixed at 4.95% for 2 years) however our circumstances have changed and we want to stay in this house for at least 7-10 years.
We are both in a our mid 30's and I work as a contracotr and earn over £100 per year, my wife earns £25k, we eat well and spend money on things we like.
Our interest only mortgage has come to the end of 2 year deal and now we are paying an extra £120 per month as it has gone over bae rate.
We have around £20k in a high interest account and around £13k in Cash and Stocks and Shares ISA's with the Halifax.
We decided to get a repayment mortage and use these savings to pay off some of the capital, i.e. borrow £190k as a repayment mortgage.
We could also afford to pay of large chunks every 6 months or so, perhaps £10 every 6 months.
I decided to have a meeting with my financial advisor from Halifax and spent 3 hours with him yesterday, his thought process was totally different to mine. He said that I should stick to a repayment mortgage and put my extra money and monthly payments into topping up our ISA's and then take out some further investments (CIP) and make my money work for me at a much higher rate of interest than what I would be paying on my borrowings.
Our Cash ISA's have grown an average of 19% year on year over the last two years, O.K, they are classed as high risk but only 20% is in the far east.
Our ultimate goal is to be Mortgage free in about 5-7 years, with the money coming in and spending a little less (we have everything we need in life) I think this is possible, however my mind keeps saying just pay chunks of the mortgage, £10k here and £10k there.
But the saving options seems more tempting, which way will I pay my mortgage off quicker? In fact, do I need to pay my mortgage off at all if my income could earn my a massive high rate of interest?
Please help!!!
0
Comments
-
Wow you are depserate to start two threads!:rotfl:Personal Responsibility - Sad but True
Sometimes.... I am like a dog with a bone0 -
ops:rolleyes:0
This discussion has been closed.
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 351.7K Banking & Borrowing
- 253.4K Reduce Debt & Boost Income
- 454K Spending & Discounts
- 244.6K Work, Benefits & Business
- 600K Mortgages, Homes & Bills
- 177.3K Life & Family
- 258.3K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.2K Discuss & Feedback
- 37.6K Read-Only Boards