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Interest Only Mortgage

ConnyD
ConnyD Posts: 3 Newbie
in Mortgages & endowments
Hi Guys,

I have an interest only mortgage and I'm looking at savings plans to raise the capital in 20 years time. I've been looking at a regular long term savinings plan yileding 3% pa. Is this the best solution. Thanks in advance.

Comments

  • getmore4less
    getmore4less Posts: 46,882 Forumite
    Part of the Furniture 10,000 Posts Name Dropper I've helped Parliament
    What's the mortgage rate?

    Why not just overpay?
  • catieeb06
    catieeb06 Posts: 576 Forumite
    How much do you owe? What's your current interest rate, SVR?
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it.
    This signature is here as I follow MSE's Mortgage Adviser code of conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • ConnyD
    ConnyD Posts: 3 Newbie
    Hi,

    Thnaks for the quick response. Mortage is with Northern Rock and the interest rate is 4.78 I'll owe 136,000 at the end of the term.
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Then your best option is to immediately start to make overpayments to your mortgage account.

    You are borrowing money at 4.78% and proposing to earn 3% on your savings. So that's illogical.
  • getmore4less
    getmore4less Posts: 46,882 Forumite
    Part of the Furniture 10,000 Posts Name Dropper I've helped Parliament
    ConnyD wrote: »
    Hi,

    Thnaks for the quick response. Mortage is with Northern Rock and the interest rate is 4.78 I'll owe 136,000 at the end of the term.

    Up your payment to at least £882pm job done till the rates change.

    (IO should be around £542pm)

    Also look at getting a better deal.
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