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Two mortgages - which to overpay?

kirstyegg81
kirstyegg81 Posts: 7 Forumite
in Mortgage-free wannabe
Hello,

I have two mortgages both with Nationwide at the same rate of interest. I can overpay either by up to £500 a month with no penalty - but which should I overpay first (or should I overpay a bit to both)?

They are:
£71,500 on repayment, 24 years remaining.
£175,000 on interest only

Thanks in advance.

Comments

  • shortchanged_2
    shortchanged_2 Posts: 5,546 Forumite
    Not my area of expertise but common sense would tell me to overpay the interest free mortgage first otherwise in a few years time you will still have a debt of £175000.

    However I'm sure the mortgage experts on here will correct me if I'm wrong.
    Why are we here?......................because we are not all there.
  • originalmiscellany
    originalmiscellany Posts: 1,655 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker Mortgage-free Glee!
    I would overpay the one that has the higher interest rate first. Doesn't matter if it's interest only or repayment.
    Feb 2012 - onwards MF achieved
    September 2016 - Back into clearing a mortgage - Was due to be paid off in 32 years in March 2047 -
    April 2018 down to 28.00 months vs 30.04 months at normal payment.
    Predicted mortgage clearing 03/2047 - now looking at 02/2045
    Aims: 1) To pay off mortgage within 20 years - 2037
  • alex_p
    alex_p Posts: 82 Forumite
    Mortgage-free Glee!
    what is the rate of interest and terms? There isn't enough information to answer that question imo.
    Mortgage-Free [STRIKE]Wannabe[/STRIKE]!
    Mortgage (2006): £170,499 | Mortgage-free (2011)

    IT professional by day, Internet ninja by night.
  • dimbo61
    dimbo61 Posts: 13,727 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    If both are at the same rate then overpay the interest ONLY one as you have a repayment vehicle in place for the repayment part!
    Have you got a repayment vehicle ( endowment,ISA,s pension) for the interest only part?
  • getmore4less
    getmore4less Posts: 46,882 Forumite
    Part of the Furniture 10,000 Posts Name Dropper I've helped Parliament
    If you can afford £500 or more you could shortern the term of the repayment or transfer some of the Interest only to repayment to enable even bigger overpayments(from current levels)
  • mlz1413
    mlz1413 Posts: 3,156 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    alex_p wrote: »
    what is the rate of interest and terms? There isn't enough information to answer that question imo.

    Agree with this, plus are either in fixed periods?
This discussion has been closed.
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