first buy/new mortgage

funk100

Hi all,

Just after some advice. I am purchasing a house as part of the first buy scheme and I will be looking to save up and pay for the interest free equity loan off within 5 years.

I have read everything there is to know and I am totally happy with the first buy scheme as it suits my circumstances at present and have no intention of moving on else where so I am not asking for advice on it.

Would you recommend over paying mortgage also or putting any surplus money that I have left over into ISA or any other high interest account in the current climate?

The reason why I ask is that I want to have as many options open as possible in 5 years time. i.e whether extra savings could go towards the equity loan and pay that off quicker or reduce the mortgage term quicker!

Thrugelmir

Personally I would build up sufficient savings to repay the interest free loan first. In case remortgaging is not a feasible option.

To obtain the best rates lock your money into fixed term ISA's with a maturity date before the due date of the interest free loan.

Once you've accumulated sufficient savings then start overpaying the mortgage.