Pay off mortgage ?

kevlarpants

Hi, I just wondered if it was wise to pay off some of a mortgage ( endowment ) with some savings or carry on saving ?.
The savings are getting 5% on a web saver and the mortgage is on a tracker at 6.200% at moment.

Many thanks,

Missy79

I guess this would depend on whether you have sufficient to meet the capital cost at the end of your mortgage period already or not.

21castlehill

I wouldn't advocate the following action for everyone but I did a lot of sums & this allowed me to sleep easy at nights. I had an endowment mortgage with 2 endowment policies which over the last 4 years had started loosing £1000's, they were still worth slightly more than I'd paid in but were projecting a 50% shortfall.

I tried all the claim for compensation stuff but for me it proved to much & I gave up. In the end I worked out if I sold the endowments & used the procedes to reduce my mortgage the payments would drop a fair bit. So having shopped about I decided to change to a repayment mortgage but kept the payment term the same as my endowment had been. So i had been paying for 14 years already, so I took out an 11 year mortgage with First Active fixed for 5 years @ 4.79%.

The figures were incredible it worked out that I was now looking at paying £35 per month extra but in 11 years time I would be mortgage free as opposed to potentially still owing 50% of my original loan, for me the peace of mind I've gained far outways the paltry £35 cost (£4620 over the entire loan term). I know the markets may have recovered but in all honesty I believe they would have never recovered their losses & endowments are the biggest rip of ever in the financial services industry.