Been Investigating becoming MF

I've been looking at making over payments

I been playing with the calculator and according to my mortgage i can make up to 10% as im in the initial years of a new mortgage

My mortgage is 88000
Paying £437.32 per month
3.44% interest
25 years

if i paid 10% extra regular according to the calculator by entering 10% into the monthly recurring boxes it says ill be free in 2 years time .... wrong, too good to be true.

So i entered the 10% into the box £43.732 it now says ill be done in 21 years 5 months which im not sure if there is much point in doing at this time, unless im looking at this in completely the wrong way.

That said, i enjoy saving money so is it better to put my long terms savings into my mortgage as an overpayment than a savings bond and then enjoy that when i want to move house.

Replies

  • originalmiscellanyoriginalmiscellany Forumite
    1.7K Posts
    Part of the Furniture 1,000 Posts Combo Breaker Mortgage-free Glee!
    Forumite
    Try here:

    http://www.moneysavingexpert.com/mortgages/mortgage-overpayment-calculator#result

    If you overpay a total of £500 - rather than £438 you will pay off your mortgage 4.7 years early and save approx 8.7k in interest. Surely that's a good thing!
    Feb 2012 - onwards MF achieved
    September 2016 - Back into clearing a mortgage - Was due to be paid off in 32 years in March 2047 -
    April 2018 down to 28.00 months vs 30.04 months at normal payment.
    Predicted mortgage clearing 03/2047 - now looking at 02/2045

    Aims: 1) To pay off mortgage within 20 years - 2037
  • originalmiscellanyoriginalmiscellany Forumite
    1.7K Posts
    Part of the Furniture 1,000 Posts Combo Breaker Mortgage-free Glee!
    Forumite
    PS Once you do all of your calculations and realize how things will free up long term, you[ll get the bug and you will get stuck in. You are fortunate in that the mortgage is relatively not huge in comparison to others on here, but overpaying now really will make your life a lot more enjoyable later on down the line.
    Plus as a person who enjoys saving, you should find mortgage calculators which show how much less you are paying every month will be an incentive - every month it will drop a little :)
    Feb 2012 - onwards MF achieved
    September 2016 - Back into clearing a mortgage - Was due to be paid off in 32 years in March 2047 -
    April 2018 down to 28.00 months vs 30.04 months at normal payment.
    Predicted mortgage clearing 03/2047 - now looking at 02/2045

    Aims: 1) To pay off mortgage within 20 years - 2037
  • foxtrot_mikefoxtrot_mike Forumite
    108 Posts
    Tenth Anniversary Combo Breaker
    Forumite
    I guess the interest saving is the great thing
  • originalmiscellanyoriginalmiscellany Forumite
    1.7K Posts
    Part of the Furniture 1,000 Posts Combo Breaker Mortgage-free Glee!
    Forumite
    Totally! Work out how much you pay per day (Won;t be difficult), then work out how overpaying after a year will reduce it... The key thing is to keep your payments the same as you are effectively paying more off every month. Fantastic!
    Feb 2012 - onwards MF achieved
    September 2016 - Back into clearing a mortgage - Was due to be paid off in 32 years in March 2047 -
    April 2018 down to 28.00 months vs 30.04 months at normal payment.
    Predicted mortgage clearing 03/2047 - now looking at 02/2045

    Aims: 1) To pay off mortgage within 20 years - 2037
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