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Is their an alternative to capital repayment?
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jason.lawrie
Posts: 47 Forumite
Im currently on a capital repayment mortgage which I took out last year but want to know from other members if there is any alternatives?? I know endowments have deceased - what other ways can I pay interest only to the mortgage company and invest money elsewhere in the hope the mortgage can be paid off early - a risk free gamble if there is such a thing nowadays???? Any advice welcomed. Many thanks.
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You can have any type of savings vehicle you want to pay off your mortgage - most lenders do not need a policy assigned to them, they only make you aware of the importance of making sure something is in place that will repay the debt - ISAs, U/Ts, Bonds, pensions, national savings etc etc.
Risk free types of investment would be classed as deposit accounts in the main - whether or not this is suitable depends on your risk profile, and also how much capital you are hoping to invest for growth and what growth rate would be needed.I am a Mortgage AdviserYou should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
using a flexible mortgage like the OneAccount gives you the best of both worlds, any savings or cash stay in your "account" (earning the equivalent of 5.25% or whatever the current mortgage rate is) and offset interest every day and having your pay go straight into the account have a further effect especially if you can get all your standing orders towards the end of the month ..lol. I own shares that I sell off when the price looks good and dump that in the account, nothing to stop you buying again when the price drops as you can just write a cheque out of the account again
They only take the interest on the outstanding mortgage amount out of your account each month but you can if need be get back any of your capital repayments or savings at any time without penalty. I have always been ahead of my 25 year target since I opened mine !! (think I'm 5 years ahead ..
there are several of these types of account aroundEx forum ambassador
Long term forum member0 -
Pension mortgages probably only make sense if you are a higher rate taxpayer, and it depends on your other pension provisions, etc.I have five stars! This doesn't mean that I know anything about any of the things I post. I could be a raving lunatic, or a brilliant genius, or just some guy on the internet. In fact, I could be all three at the same time.
If anything I say makes sense, then do it. If not, don't. Don't blame me or my stars if you do something stupid because I suggested it. I'm responsible for my own stupidity only. You are responsible for yours.
Why, I don't even have five stars anymore! Aren't you glad you aren't responsible for my stupidity?0
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