On Nationwides BMR Rate - Whats the benefit of making a huge overpayment

bonzo101

Dear Forum,

I've recently gone onto Nationwides BMR rate and wondered if making a huge overpayment to my mortgage to knock the years down would be the right thing to do. It seems logical but I just wanted to check to see if there was anything I am missing here. I read an article on this website which said the best thing to do is treat your mortgage as what it is dept! and pay this off sooner rather than later.

Has anyone been in a simular situation or can anyone advise me on whether I am doing the right thing here?

Thanks in advance to all.

Kind Regards

Bonzo

luckyfool

Are you a taxpayer? If so, basic rate or higher rate? What is the best after tax interest rate you can get on your savings? If its less than 2.5% then overpay. Of course once its overpaid its gone, and you no longer have access to it readily, so if you do not already have 6 months income sitting in savings as instant or nearly instant access for a rainy day then you should sort that out before overpaying your mortgage.

themull1

i think that you can overpay up to 500 per month on nationwide mortgage, the sooner you pay it off the better, will save you loads in interest.

Yorkie1

themull1 wrote: »

i think that you can overpay up to 500 per month on nationwide mortgage, the sooner you pay it off the better, will save you loads in interest.

That's only during the fixed rate term. Once moving onto the variable rate after the tie-in period, as the OP has just done, then no maximum limit to overpayments.

firstaspect

I always try and overpay whenever I can, as you say it's basically just debt so the quicker you pay it off the better.