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quick question - part intrest only/part repayment
Piggy-bank_2
Posts: 66 Forumite
I think this is a simple one, but can't quite get my head around it!
40K Interest only
45K Repayment
both currently on NW Trackers (2.79%), but due to move V shortly to SMR (2.5%).
If I have 5K available to pay off (once on the SMR), does it make any difference which one it gets paid off?
My gut feeling is it's better to pay it off the repayment lump, but my logical thoughts are that it doesn't make any difference....but I still feel I'm missing something!
MTIA
40K Interest only
45K Repayment
both currently on NW Trackers (2.79%), but due to move V shortly to SMR (2.5%).
If I have 5K available to pay off (once on the SMR), does it make any difference which one it gets paid off?
My gut feeling is it's better to pay it off the repayment lump, but my logical thoughts are that it doesn't make any difference....but I still feel I'm missing something!MTIA
0
Comments
-
The potential maximum savings overall are the same.
IF you maintain the total normal payments the same no difference.
If you have the payments recalculated
At the end of the term you owe £35k if you pay off the I/O.
At the end of the term you owe £40k if you pay it off the repayment.0
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