Over Paying, is it worth it

snowmen

glitter123 wrote: »

We had a Nationwide mortgage which we overpaid by £500 in the later stages. We had to tell Nwide we wanted to keep our standard repayments the same every month, otherwise each time we overpaid they simply recalculated and reduced future monthly repayments. Our aim was to repay the mortgage asap.

Same here - if you have online banking you can just go on there, click on your mortgage account and then click on overpayment preferences - just change to what you want. I would always reduce the term rather than the monthly payment unless the extra money a month is vital to you.

Lifes_Grand_Plan

I have overpaid my HSBC mortgage by the maximum allowed (20%) ever since day one of getting the mortgage. Because my payments have been overpaid since day 1, we have never missed the extra money each month because the 120% payment is just the normal amount to us.

If we keep it up for the whole mortgage (which we certainly intend to) then it should reduce the term by about 7 or 8 years and will save us (I think it was) £60k in interest.

In 4 months, our fixed rate will end (5.09%) and we will revert to HSBC's standard rate currently 3.94% which would mean going from 5.09% to 3.94% our payments would go down a bit.... regardless, we will still keep paying the same payment we currently are (plus a bit more if we can afford)... reducing to the minimum payment might give us an extra £150 - £200 in our pocket each month.. thats not a lot really, we could easily soon waste it..... but sticking it into the mortgage saves us loads and we don't miss it.

I would certainly recommend overpaying mortgages to anyone who can afford it, young or old... even if it is just a few quid each month.

It is great knowing that 5 years ago we took out a 25 year mortgage... after 5 years we have 13 years left to pay.. woo hoo.

linz

Sorry to hijack the thread rather than start a new one but can I just ask a quick question about Nationwide (fixed rate) mortgages.

If I have op's in the overpayment reserve and the fixed rate ends, moving onto the SVR would I be able to get at these op's should I ever need to in the future or does all that flexibility go once the fixed rate is up?

Thanks in advance if anyone knows