Overpayments or Save for next move

mcharry

Hello, We are currently paying off a mortgage and are saving approx £200 per month towards moving. When we re-mortgaged the advisor said that we would be better to save our money rather than make overpayments on the mortgage so that when we take out an additional mortgage to move to a bigger house we get a better LTV. What do you guys think, would we be better making overpayments which will incur no fee, this will be for 1 or 2 years or saving up to £5000 over the 2 years and having 2 mortgages? i hope this makes sense, I've tried looking through old posts to see if there is something similar but without luck. Maybe I should just listen to the advisor but often different companies tell you different things...

Any help/advice greatly appreciated!

Dave_Ham

Is your intention to have 2 mortgages when you buy next house, or to redeem this mortgage and have just the new one?

Sorry not that clear..

mcharry

Hi Dave, it's really just to do whatever is cheapest, the mortgage advisor seemed to think that having 2 would be better because of having 2 lower LTV mortgages although surely it would total the same?

gazfocus

I think what Dave meant was are you planning to sell your current home to buy your next place or are you planning on renting your current home out?

mcharry

Hello, we would sell our current home, I'm not the best at explaining myself, sorry!

Thrugelmir

If the rate of interest is higher on the mortgage than you earn on your savings. Then overpay on your mortgage.