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Best time to overpay?

Plans_all_plans
Plans_all_plans Posts: 1,630 Forumite
in Mortgage-free wannabe
Hi

We're in a position to pay a lump sum off the mortgage. Interest is added daily. I am wondering whether we should pay it at a particular time?

We overpay monthly too and the overpayments come out on the same day as the mortgage payment. I spoke to bank workers and I've had two different answers: one said "it doesn't matter what time you make the lump sum overpayment" and the other said "the day after your mortgage payment goes out".

Any advice from people on here please?

Thanks.

Comments

  • SeriouslySeekingtoSave
    SeriouslySeekingtoSave Posts: 509 Forumite
    If you are going to make an overpayment on a daily interest mortgage then you get the most benefit the sooner you pay it off. If you paid it yesterday you'd have avoided today's interest charge.
    Mini Challenge - Halve 2nd Mortgage by Year End
    Starting: £10,000 Currently £8,142.62
    £3,142.62 to go!
  • SeriouslySeekingtoSave
    SeriouslySeekingtoSave Posts: 509 Forumite
    Er, assuming you aren't getting charged an OP penalty of course!
    Mini Challenge - Halve 2nd Mortgage by Year End
    Starting: £10,000 Currently £8,142.62
    £3,142.62 to go!
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