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Which to pay off first (settle the debat please)
Penny1981
Posts: 92 Forumite
Hi all,
Mortgage SVR 4% £84244.49
Additional borrowing £4.29% £7027.66
We have £2000 which we would like to pay off either of these two debts.
I say pay it off the highest % rate which would be the additional borrowing. My husband thinks to pay it off the larger debt which would be the mortgage.
we have a 10% cap on overpayments on the mortgage (were no where near this) but if it is the same on the additional borrowing this may restrict the amount we can pay off the additonal borrowing debt??
Does any one have any thoughts on this please?
Mortgage SVR 4% £84244.49
Additional borrowing £4.29% £7027.66
We have £2000 which we would like to pay off either of these two debts.
I say pay it off the highest % rate which would be the additional borrowing. My husband thinks to pay it off the larger debt which would be the mortgage.
we have a 10% cap on overpayments on the mortgage (were no where near this) but if it is the same on the additional borrowing this may restrict the amount we can pay off the additonal borrowing debt??
Does any one have any thoughts on this please?
TTC #1 02/11
:jEED 12/11:j
MFW by 2020 Currently £91,272.49 28/06/11
:jEED 12/11:j
MFW by 2020 Currently £91,272.49 28/06/11
0
Comments
-
Think this one is a no brainer! Trying to think of a catch but I would say pay off as much as you are allowed of the one with the higher interest rate.[STRIKE]£106,200[/STRIKE] mortgage with 5% deposit 2 years ago on 6.99% 04/06/08 :eek:
Overpaying the max 10% per year for the next 2 years until July 2013 when I can remortgage and should be able to get down to 55% LTV.
Overpaid 10% £10,619.87 Dec 2010 & 10% £9,475 Aug 2011
Mortgage was £690 now £560
Currently £85,203 - 71% LTV 26/08/110 -
Thank you, i thought it was an easy one but my husband planted an element of doubtTTC #1 02/11
:jEED 12/11:j
MFW by 2020 Currently £91,272.49 28/06/110 -
He is right you need to speak to the lender/s ? of the mortgage and the loan to see if you have a 10% overpayment limit on the loan as well as the mortgage.
Now if thats the case just pay 10% off the loan and the rest off the mortgage0
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