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Advice on paying a lump sum and reducing the term of the mortgage please.
moneytalk_2
Posts: 8 Forumite
We currently have a fixed mortgage with Nationwide which is coming to an end soon. We pay £467 a month at 5.18% and this was fixed for 5 years with 14 years 3 months to go. The balance is now around £50K.
I have about £8k to put against this mortgage and still have an emergency fund of £9K, which should keep me going for 6 months just in case I loose my job. I would also like to reduce the term of the mortgage down by 5 years and fix for another 5 years. My average payments will still be around the £460 mark which I can still afford to pay.
So I would like to reduce the mortgage down to £42K, reduce the term down to 9 years and fix for 5 years at the average rate of 4%. Monthly payments will be at around £460.
Is this a wise step to do? Should I pay the lump sum against this mortgage and is it a good idea to reduce the term by 5 years?
Any advice would be greatly appreciated.
I have about £8k to put against this mortgage and still have an emergency fund of £9K, which should keep me going for 6 months just in case I loose my job. I would also like to reduce the term of the mortgage down by 5 years and fix for another 5 years. My average payments will still be around the £460 mark which I can still afford to pay.
So I would like to reduce the mortgage down to £42K, reduce the term down to 9 years and fix for 5 years at the average rate of 4%. Monthly payments will be at around £460.
Is this a wise step to do? Should I pay the lump sum against this mortgage and is it a good idea to reduce the term by 5 years?
Any advice would be greatly appreciated.
Want to be mortgage free by the age of 46!
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