Thistlewhistle makes a dash for Mortgage Freedom!

elantan

I would go car finance as well if there was no penalty an it saved you money ... The mortgage is a longer slog but the psychological boost of paying the car off early may help you stick to the mortgage? Ie : well if I can pay x amount of in y time how much quicker can I pay the mortgage with an extra £207 a month ? Type thing ... You could always split the extra between the two and see how that goes :-)

Tilly_MFW_in_6_YRS

Hi Thistle, this sounds like a Lois question to me. Hopefully she'll pop by and give you a logical answer. I agree with El and Ztan, makes more sense to me to clear car loan.

Best wishes Tilly x

Thistlewhistle

Thanks ztan, elantan & Tilly.
I thought car first too but then second guessed myself.
If you see Lois, Tilly, please tell her I'm looking for her!!!
Tx

gallygirl

Alternatively, have a play on https://www.whatsthecost.com - put in the debts separately and then as one - will give you different pay-off dates etc.

Sounds like that's the way to go though :T

Lois_E

Thistle, the big question is how is the car interest calculated? Many car loans have the interest calculated up front, so there's no penalty for paying early, but it doesn't make any difference to how much interest you pay. (Seems v unfair to me, but that's how it's often done.) It sounds as thought your car loan is like that, since you quote it as "pay back £10,394.24 over 4 years", implying that nothing you do now is going to make any difference to that number. So there's no point in OPing it, and it would be much better to leave the car payments to keep doing what they do, and throw any spare money at the mortgage, where the interest is calculated on the balance as it keeps changing, so OPing makes a difference.

OTOH, if you happen to have an unusual car loan that is calculated the way CCs and mortgages are, then naturally you need to throw your money at that because it's a higher rate. It's true that total interest can be higher on something that's over a longer time but a lower rate, but that consideration doesn't matter here, if we are assuming these decisions are not about how much or when to pay but just about which order to pick the things to which to direct your money. In other words, I'm assuming that once the car loan has gone you will be redirecting that money towards your mortgage??

elantan

Ohhh Lois very valid points about the way the interest is calculated, I had forgotten about that till you mentioned it, I first came across that last year when we bought a new car and that was the way they worked ... I went to the bank and got a loan instead as it worked out much better for us

Thanks for the reminder

Thistlewhistle

Thanks Lois, ill contact the loan company on Tuesday and check on how it's done. I think I asked that at the beginning and was told that if I did pay off some early, they'd recalculate the total amount payable, in other words, if I paid half of it off, I'd pay half the interest. But I'll check.

Gee, it's good to be around folks who know their stuff!!!

gallygirl

Thistlewhistle wrote: »

Gee, it's good to be around [STRIKE]folks[/STRIKE] Lois who know [STRIKE]their[/STRIKE] her stuff!!!

Hope you don't mind me correcting your post :rotfl:

Thistlewhistle

gallygirl wrote: »

Hope you don't mind me correcting your post :rotfl:

Ha ha! Not at all. I was being generous. You obviously know a lot more about people than I do GG!!!:rotfl:

Thistlewhistle

Right!

Tomorrow is Easter Sunday and co-incidentally is month end. It's time to empty my £2 coin saving tin (currently £108) and time to empty Penelope Pig, who has been collecting my pocket change all month.

Then on Tuesday, I'll bank the money and transfer it across to the new savings account I've decided to open specifically to "hold" all these little bits of monthly monies saved. Then, once I have worked out which debt needs to be dealt with first, I can make a payment from that account and start building it up again.

Things to be included in my account:

1. Tilly Tidies (Deluxe - rounding to next £5)
2. Penelope Pig Money
3. £2 coin tin money
4. Team bonuses as and when I get them (not likely for March but April is a possibility!)
5. eBay sales (have I got some junk to sell!!)
6. Money made from covering other SW Groups (£240 possible in April)

Sounds like a plan.

Any ideas on with whom I should open my savings account?
Needs to be instant access, no penalty, and manageable online.
Now where's that Lois.........?