To overpay or not??

tugrin

Hi
I am currently on a DMP of £333 a month for the next 62 months. This takes me to my first 'could retire if was financially secure' age (60) but by then I will still have a mortgage of £50000 which I could possibly pay off with my lump-sum although that is not certain in these times.
My question is - should I try to overpay on my mortgage (obviously only a bit) for the next 62 months to bring this figure down or should all bits of savings go to the DMP? I fear my health will not let me continue for a further 5 years until 65 to pay off mortgage that way and I do not want to be in the position of having to sell up and move away from here where my home is.
Any ideas will be gratefully received!

originalmiscellany

what does DMP stand for?

I'm a lot younger than you (30+ years) and want to ensure I we're mortgage free as soon as possible - and I think if you can afford it you should aim to clear as much in as fast a time as possible...

If as you've said health is an issue, then looking now and making cut backs could mean you are in a better position to enjoy your life post-retirement.

Your issue is even with this mortgage cleared you will still owe £50k which you may or may not be able to pay off. That's a worry.

Can I suggest, you take a serious long hard look at your finances, and see what you can afford to cut back on, and then put in place a mechanism save/overpay as much as you can.

If you can (and I hope at your age) you can save an extra 166 to a total of £500, you would be in a much better position!


Stats:
333 a month * 62 months = £20,646.

500 a month * 62 months = 31k - an extra of 10k...

666 a month * 62 months = 41k - an extra of 20k.


Qns:
Mortgage: What's the interest rate on it?
Will you or will you not be able to clear the remaining 50k off your mortgage?

Will you be able to live off your pension at current rates?

Personal qn - what's your salary, and do you have any savings?

Giving us facts and figures would give us the option to support you much more effectively.

Hope it helps, and sorry it's a bit rambling.

Froggy-G

DMP = Debt management Plan

tugrin

Hello and thanks for taking an interest.
DMP stands for debt management plan - basically I've been a complete eejit for the last couple of years and got into some serious card debt which the Conumer Credit Counselling service are helping me to sort out - thats what runs for the next 62 months.
My salary is £35000 pa and I have 96000 out standing on the mortgage at a apr of 5.790% apr fixed for a further 3 years.
I dont get state pension until 65 but teacher pension could kick in at 60 - howeer I dont think that will cover the mortgage repayments on its own - oh dear what a mess....sorry.