The price is right! Time to hammer the mortgage

financialbliss

WestonDave wrote: »

7. Once all the above is done, I would personally be putting money away in ISA's etc at say 3% so I am earning more money than I would be saving at 0.77% if I used it to actually pay down the mortgage. Having a £100k mortgage is no problem if you have £100k in the bank earning more in interest than the mortgage is costing. You probably won't get that far soon but that would be the aim assuming interest rates stay as they are. Every time interest rates move, either on the mortgage or the savings you'll need to check whether its better to keep savings or clear the mortgage.

Another excellent response by WestonDave. Point 7 is exactly what I'm doing.

I've a mortgage at a rate of 2.5% but I'm getting savings at 3.1% thus I'm no longer overpaying my mortgage.

Back to yourself - your £105,000 mortgage at 0.77% is costing you roughly £808.50 a year in interest.

But, your £900 CC at 17% is costing you £153 a year in interest.

As WestonDave mentioned - the interest rates are key - clear your debts from the biggest rate to the smallest rate. Long term, this will save you the most money and allow you to become debt and mortgage free sooner.

FB.

Sepa74

You definitely want to clear your debts in order of the highest interest rate. Dave was spot on with his list, but I would be tempted to clear the 17%cc first as it is a small amount, and then you get the buzz of clearing it.

Why don't you post a full SOA so we can see where else you can make some savings / prioritise getting those debts down. Here is a link to a very good SOA http://www.makesenseofcards.com/soacalc.html

I am very envious of your mortgage interest rate, but don't not at all of your other debts!

Good luck! I look forward to hearing your progress

michelle2904_2

just a little update for the the week

overpaid £200 for mortgage instead of £500
opened a isa and deposited £300 (have now taken on board advice to save);)
paid £200 on hubby barclaycard
paid £300 my barclaycard
paid £147 tesco cc
paid £153.00 virgin cc
paid £112 tesco loan

total £1,112.00 off the debt & £300 towards our savings :T

also check me out fellow mse people i bought ds blackberry phone for xmas from Mr T
using £35 tesco vouchers doubled to £70 a £20 giftcard from tesco loans (they messed up big time with my dd (another story) it had £15 off offer on the phone, which left me wait for it.......£25 to pay:j:j:j