Mortgage shrinker

ankspon

Just tried the mortgage shrinker and it reckons i can reduce my mortgage from 22 years to 8 years,has anybody done this and would you recommend it or is it not as straight forward as it seems.

dunstonh

Its not rocket science and it can apply to virtually all mortgages. You just pay more in each month and the balance goes down quicker.

Conrad

david

you don't say which 'mortgage shrinker, nor which lender.

I'm guessing you mean something like the one account.

The key point people get confused over is this; You are usualy asked to give an indication of how much you spend per month against how much hits your account. Those shrinker systems assume you will always save the difference and let it roll up forever!

EXAMPLE;
INCOME £2000 PM NET
OUTGOINGS INC MORTGAGE £1500
SAVINGS TO BE RETAINED AND ROLL UP EVERY MONTH £500 (so £6000 over 1 year).

Where people go wrong is then then later spend all or some of those notional savings.

ankspon

Thanks conrad,it was the one account

jamesd

davidhwdn, that one is misleading, in part because it assumes that any money not spent is going to be used to reduce the mortgage. That makes it look better than other mortgage deals even though it's the same as overpaying on any mortgage. Bit of a cheat but it helps them with sales, I suppose. It's easy to do the same with any offset mortgage, you just pay extra into the offset account and build up a pot of money there that you can draw on whenever you need to.

It's almost always easy to get a cheaper interest rate on an offset mortgage from someone else and save money compared to using the One Account.

getmore4less

When I looked at the OA calculator/reducer a while back it was very easy to get the normal mortgage payment counted twice if you were not carefull.

It might have been fixed

hunggaur

davidhwdn wrote: »

Just tried the mortgage shrinker and it reckons i can reduce my mortgage from 22 years to 8 years,has anybody done this and would you recommend it or is it not as straight forward as it seems.

hi david yes i have done this

we took out a mortage for £100K in 2000. we paid my wifes salary into the one account and just left it there and then live off my earnings in an other account and paid off just over £50k in 7 years. just paid in another lump sum and our mortage will be gone by the end of the year.

it works as long as you have the disipline to not touuch the account.

we are now thinking of buying another house as we can till access the 100k facility and start all over again.

hope this helps

jon

dunstonh

hope this helps

Nearly 2 years too late probably

Radiantsoul

dunstonh wrote: »

Nearly 2 years too late probably

I wonder how people find these old threads!

JQ.

Drives me mad. You start reading a thread only to discover half way through that's it's years out of date and someone's dredged up a really old post. I just don't see the point.

dkmax_2

JQ. wrote: »

Drives me mad. You start reading a thread only to discover half way through that's it's years out of date and someone's dredged up a really old post. I just don't see the point.

Typically a prelude to SPAM.