Overpayment of mortgage - interest only Vs repayment

Mel_junipers

I have a mortgage comprising of approx 17K interest only and 63K as a repayment.
I have been overpaying the mortgage by £50 per month. I just learned that this is being split equally between both parts of the mortgage.

Which is best for me - to overpay the interet only portion? or the repayment portion?
Or does it not matter?

Thanks in advance

UK007BullDog

If you can tell them to put it all towards your interest only part then that will also reduce somewhat the loan amount just like the repayment mortgage.

rjm2k1

Assuming the rate is the same on both, I don't think it makes any difference, however, overpaying on the interest only side will reduce the lump sum you have to cough up at the end of the term, overpaying on the repayment side will either reduce that term or reduce your monthly repayments (once you stop overpaying). So, if you'd rather keep the repayments and term the same, but not have to cough up the lump sum, it would be best spent on the interest only part. If, on the other hand, you don't mind having to cough up a lump sum (maybe you have some other investments which will cover this when it comes to it) you could benefit from either reduced monthly outgoings (when you stop overpaying) or a shorter term on the repayment side. It just depends on when you want to get the benefit from the repayments.

Paying both off gives you both benefits to a degree, it doesn't cost you any more or less.