Massive savings

welshman01

Hi,
I wanted to share with you guy’s how much my mortgage outlook has changed for me since buying my home in 2006. The change is due to overpayments made and TODAY’S interest rate.
Both figures are vague due to it being a projection based on the interest rate for the duration of the mortgage. But for the purpose of making me feel good. I’ve left it simple - neither does it account for interest paid in the last 5 years. Either way things are looking much better today than they did in 2006.

2006 (House purchased for £96,500)
Principle Mortgage amount = £91,000
Interest Rate = 5.99%
End of mortgage = 2036

No of day’s interest = 11,111 :eek:
Interest Accrued = £165,961.37 :eek:
Daily Interest = £14.93 :eek:
Principle + Interest = 256,931.37 :eek:

2011 (House Value approx £95,000 – not that I could sell!!)
Principle Mortgage amount = £64,000 :T
Interest Rate = 2.5% :T
End of mortgage = 2028 :T

No of day’s interest = 6,332 :T
Interest Accrued = £27,756.71 :T
Daily Interest = £4.38 :T
Principle + Interest = 91,756.71 :T

edinburgher

That's some good OPing - glad to see it's working out for you

hcb42

well done, now can you pay mine :P

dimbo61

So did you plan on being on an SVR of 2.5% ? or just get lucky!
Overpay and build up savings in cash ISA,s paying more than 2.5%
Well done on clearing £27K in five years

originalmiscellany

Well done that man. Good OP action going on, and amazing stats to see how much you could be paying if you're happy to take the leisurely 25 year plan on paying off your mortgage. Thanks for sharing these stats.

welshman01

No like most people on a low SVR, it was just pure luck - although it would have felt nice to have done it by design. As the mortgage isn't massive the low SVR doesn't make that much difference. I know some people with massive mortgages who are saving £100s and £100s a month from the low rate, pilling it all back into the mortgage saving themselves loads of cash.

Jonbvn

welshman01 wrote: »

I know some people with massive mortgages who are saving £100s and £100s a month from the low rate, pilling it all back into the mortgage saving themselves loads of cash.

People on rates super low rates (like me;)) are generally better off saving than overpaying their mortgage.

In simple terms if your net savings rate is higher than your mortgage rate then it is better to save.

hastie

really illustrates to someone who has never thought about overpaying a mortgage, why it is so important to pay off and why a good mortgage rate is so important!

You have done v well with your overpayments so far. Keep it up. Goal in site!

lincoln-potter

Jonbvn wrote: »

People on rates super low rates (like me;)) are generally better off saving than overpaying their mortgage.

In simple terms if your net savings rate is higher than your mortgage rate then it is better to save.

Generally yes, but you should also take into account taxation depending on which tax bracket you are in as this can negate any higher savings rate you might be achieving (assuming your ISA is full)

welshman01

Hi,
Yes my ISA's are full. My goal is to clear the mortgage in 24months. Then sell to buy a better/nicer house with what will hopfully be a large deposit.

SAMMYE_2

welshman01 wrote: »

Hi,
Yes my ISA's are full. My goal is to clear the mortgage in 24months. Then sell to buy a better/nicer house with what will hopfully be a large deposit.

Get cracking!! As this rate is as good as its gonna get and I doubt it will ever get this good again (for quite a long time)!