overpay OR save for next deposit

Kaust

Hi All

Bought a house last autumn on 2 years fixed mortgage at 5.6%. This year we can overpay our mortgage on a monthly basis. But, we are planning to move to a bigger house, hopefully next year.

So, should I over pay existing mortgage or save that money for the down payment of the new house to get a better interest rate then.

Please can someone advise? we are totally noobs when it comes to finances, mortgages etc.

Many thanks!

lee111s

Only save the money if you can attract a higher interest rate than 5.6% (which you won't be able to realistically).

Paying off the mortgage will in effect give you a higher deposit for your next house as you'll own a higher percentage of equity in your current property to use as the deposit for your next house