Going to give it a go !

dimbo61

As you have the flexibilty in your mortgage you need to watch the offers that some banks have!
build up savings in the reserve account and IF you can get a better rate from An ISA or regular saver then fill them and transfer the money back into the mortgage if mortgage rates start to rise.

silver_4444_uk

Hi Dimbo,

I have got very peeved recently at having moved cash between ISAs (several times ) for a better rate, and then having the banks drop the rate on the new ISA, when they have obviously got enough people "sucked in" on their original advertised higher rate.

But I agree completely with the logic, suggested in your post.

As I've said previously, I intend to save where I can and overpay as well. To give me the incentive of seeing the mortgage decrease.

Thanks,

Silver

SOandSO

Hello and good luck in MFiT-T2:money:

We are close by on the chart and I hope you'll help me keep motivated and i'll add my two pennyworth on your challenge:rotfl:

silver_4444_uk

Hello SO and SO,

Don't worry I'll be watching your progress with interest .

Silver

silver_4444_uk

Hello Everybody,

I thought that I'd "get my finger out today" and do an update on our progress so far.

We had some bad luck at the start of this year where we had to replace a car unexpectly. In short, my wife drove into a flood and the car was written off. (Insurance companies never pay you the full value of any car !).Thankfully she wasn't hurt and all that "smarted" was our "overpayment fund".

So we are behind schedule with where we hoped to be, but still determined to be mortgage free.

We are also taking a risk with the way that we are investing/saving our overpayments. Having looked at our mortgage rate and the current savings rates we have decided to split our repayments approximately 50 / 50, with 50% going into a stocks and shares ISA each month and 50% being a straight overpayment of the mortgage.

Who knows if we are right or not but we are both happy with the level of risk. Hopefully it will not bite us in the backside !

Wishing you success.

Silver.

silver_4444_uk

Sorry folks,

I forgot to include the outstanding mortgage balance in my last post.
It is now approx. 116k.

Rgds.

Silver

dimbo61

I have read on another post that the overpayments made by the poster were not available back to him ( when he wanted to pay his tax bill !!!) because of his high LTV as the lender had taken the latest valuation of his property so be aware and dont put all your savings in the overpayment pot.
Keep £16K in cash ISA,s as an emergency fund/ kids going to uni fund ?

silver_4444_uk

Dimbo61,

Thanks for the warning !

I must admit that I had no idea that a mortgage company could do that without prior notice / warning ? Do you have any further information on this ?

Has anybody else heard of mortgage companies doing this ???

My own property is now worth about 230k with an outstanding interest only mortgage of £142500, of which I have a credit facility saved ( overpaid ) £24000 with the rest invested in an ISA. Now whilst I want to desperately get rid of this mortgage, I purposely wanted to keep it interest only ( for the next few years anyway ) so that I could retain the flexibility of having a fund of cash if I needed access to it e.g. daughters' education etc.

If anybody has any further experience of this I would be very grateful if they could pass on their experiences.

It is making me think of having all overpayments in completely seperate funds to the mortgage account.

Rgds.

Silver

dimbo61

You have a very good LTV so this may not apply to you but if you read through some of the old posts on the MF board or the mortgage board you will I hope find the post.
With your current interest rate make sure you are filling a cash ISA each year.

silver_4444_uk

Dimbo61

Thanks for the warning.

If anybody else has information on Banks "seizing" overpayments prematurely,
I would be very interested hearing about it.

I'm also sure that other board members would be very interested to hear about it !

Thanks,

Silver