Mortgage coming to an end

wuzzbert

Hi all,

My mortgage is coming to an end, due to some strategic overpaying.

Should I completely pay off my mortgage or keep it going with a very small amount left in to pay? The reason I ask this is because Ive heard many rumours such as:

1) Its easier and cheaper to borrow money by increasing the mortgage if I need to borrow in the future.
2) It helps maintain a good credit rating (I have no other debt)
3) It avoids paying closure fees
4) It keeps your deeds in a safe place

These are all reasons for keeping it going, are they right?

Is there any good reasons for ending it?

Thanks

wodgerdodger

In my opinion you are correct for all the reasons you state. Do you also have your B&C insurance throught the lender on their Block Policy as if you paid it off you would have to resource this as well.

wuzzbert

So is it possible to have a mortgage of £100 and just pay off the interest each year forever more? Is that possible, advisable?

KarenBB

OH has a mortgage with Nationwide, he did some additional borrowing with n'wide again a few years after starting the mortgage thsi was a mortgage but set up with a different account number. He's paid off the further borrowing with redundancy payment from work all but about £50 which has kept that account open he still pays monthly mortgage payments of about 90p but by keeping the account open he can borrowback the money he paid off early at any time, just write a letter to request it.

He's being paying extra off his original loan too and he's been told that if he keeps that account open when the balance gets to £1 he can get his overpayments back if he needs to and if he wants a mortgage again on the existing property (for home improvements or whatever) it would again be done as additional borrowing set up with another account number and that would be easier than do a brand new mortgage application. Also if we wanted to move and get a mortgage for a new property he would get a better rate because he's an existing borrower.

I don't know if it's the same with all lenders but it seems to make sense for him to keep his account open when the balance does get doen to £1 (hopefully in not too many years)