Which product to overpay - one or both

delmar39

Hi

We will soon have two mortgage products:

• First 126000 at 4.69% fixed for the next 17 months (then reverts to 2.5%).
• Second £28000 at 3.99% fixed for 2 years from April 2010.

I'll run the first one until the second deal ends and then look to combine under one interest rate.

I'm going to overpay £100 and target the high interest rate product. Is this the right thing to do (I'm guessing it is) or would you split it between the two?).

getmore4less

Whats the second products follow on rate?

Combining in two years might mean losing the 2.5% rate(SVR or base tracker?) since new rates may not be so favourable.

To do the calculations need the full terms of each and the cuurent payments.

delmar39

getmore4less wrote: »

Whats the second products follow on rate?

Combining in two years might mean losing the 2.5% rate(SVR or base tracker?) since new rates may not be so favourable.

To do the calculations need the full terms of each and the cuurent payments.

Thanks for this. I was thinking the same thing here.

Product 1 SVR will be 2.5% in 17 months time (if rates don't change, but won't be more than 2% above base rate). Considering keeping this running depending on what rates are doing at the time.

Product 2 will revert to Standard Mortgage Rate of 3.99% so same as it is at the moment again if rates don't change.

Plan as things stand is to overpay £100 off product 1 then see what it drops two in 17 months time. Depending on rates after two years on product 2, I may keep it running on the Standard Mortgage Rate unless I can get a better deal.

Advice welcome.

delmar39

Sorry current payments would be:

Product 1 - £126k, number of payments left 16, Repayment, 4.69% (reverts to 2.5%) Fixed, £718.21 per month.
Product 2 - £28k, number of payments 24 from April 2010, Repayment, 3.99% (reverts to 3.99%), £149.01 per month.

delmar39

Hey guys any ideas or suggestions on this???

dimbo61

You are right overpay product 1 for next 17 months by whatever you can afford or are allowed.
In 17 months see which has the highest rate and overpay that one!
GOOD LUCK

delmar39

dimbo61 wrote: »

You are right overpay product 1 for next 17 months by whatever you can afford or are allowed.
In 17 months see which has the highest rate and overpay that one!
GOOD LUCK

Thanks Dimbo I was hoping I was along the right lines, but nice to get confirmation...!