any advice good folks

matt987106

We have a 60 K mortgage with IF, it has been out of fhte fixed rate period for a good few years

I am about to come into aprox 25 - 30 K


so the options imho are

1, pay that of the mortgage, i do not know if IF charge for this ? ? ? then our payments will be less

2, pay the 25 - 30 K into a high interest acount or a fixed rate , looking at about 2% i guess for that

3, 1, pay that of the mortgage, then continue to pay the same amount and overpay per year, not sure if IF allow this

not sure on what way to go

cheers
matt

Caladan

Need more information -

Rate on the Mortgage?
Do you have any other savings in place? - This is important, there's no point putting all the money into the Mortgage and then having to borrow money on a loan if an emergency comes up.

Also - Have you looked at Re-Mortgaging? If you're on a Standard Variable Rate you'll probably find better deals elsewhere.

matt987106

Caladan wrote: »

Need more information -

Rate on the Mortgage?
Do you have any other savings in place? - This is important, there's no point putting all the money into the Mortgage and then having to borrow money on a loan if an emergency comes up.

Also - Have you looked at Re-Mortgaging? If you're on a Standard Variable Rate you'll probably find better deals elsewhere.

we cannot find out last statement from IF, so i will answer best i can

rate on mortgage, whatever it is, the fixed rate ended years ago

no other real savings, but we get by on what we have, we have 2 young children and if we have savings, we are not enjoying life enough :rotfl:

Thought about Re-Mortgaging, but i am now Self employed and could do without the hastle of it all

a big vague i know

Caladan

My answer is going to have to be equally vague, but I'll do my best.

As a general rule you should always have around 3 months income in savings (joint income if you both work) to make sure you're not screwed if the worst should happen.

I can't find IFs current standard variable rate, but I think they're owned by Halifax and Halifax is charging 3.5% (In which case, if your loan to value is good - You can probably Remortgage for cheaper). The fact you're self employed is a bit of a hindrance but your Mortgage is small - I'd talk to a reputable broker and look at your options - Money saving is money saving!

As to lump sum reductions to the Mortgage - I'd be surprised if you had to pay a penalty for this now you're out of your fixed period but you'll have to check with the lender.

They wont automatically reduce your monthly payment amount, they'll keep it the same and you'll just end up paying the Mortgage off early.

What I would suggest considering (and I am not a qualified financial, nor should a financial adviser make a recommendation without talking to you in depth, bear that in mind when using this forum as you have no recourse if you get bad advice) is keeping around £10k back as a safety net, maybe in ISAs for you and your partner (You can pay in £5760 each to a cash ISA this tax year, rates tend to be better than normal savings and the interest is tax free), pay the rest off the Mortgage and either request they reduce the monthly repayment accordingly or enjoy paying it off a few years early. Either way you'll save interest.

Hope it helps!
Cal

Edit: It may however be that you're on a CAT Standard Tracker, in which case your Mortgage rate may be as low as 1.5% at the moment (or better). First thing to do is find out what you're paying I think

matt987106

Caladan wrote: »

My answer is going to have to be equally vague, but I'll do my best.

As a general rule you should always have around 3 months income in savings (joint income if you both work) to make sure you're not screwed if the worst should happen.

I can't find IFs current standard variable rate, but I think they're owned by Halifax and Halifax is charging 3.5% (In which case, if your loan to value is good - You can probably Remortgage for cheaper). The fact you're self employed is a bit of a hindrance but your Mortgage is small - I'd talk to a reputable broker and look at your options - Money saving is money saving!

As to lump sum reductions to the Mortgage - I'd be surprised if you had to pay a penalty for this now you're out of your fixed period but you'll have to check with the lender.

They wont automatically reduce your monthly payment amount, they'll keep it the same and you'll just end up paying the Mortgage off early.

What I would suggest considering (and I am not a qualified financial, nor should a financial adviser make a recommendation without talking to you in depth, bear that in mind when using this forum as you have no recourse if you get bad advice) is keeping around £10k back as a safety net, maybe in ISAs for you and your partner (You can pay in £5760 each to a cash ISA this tax year, rates tend to be better than normal savings and the interest is tax free), pay the rest off the Mortgage and either request they reduce the monthly repayment accordingly or enjoy paying it off a few years early. Either way you'll save interest.

Hope it helps!
Cal

Edit: It may however be that you're on a CAT Standard Tracker, in which case your Mortgage rate may be as low as 1.5% at the moment (or better). First thing to do is find out what you're paying I think

thanks for your advice, it wouldnt bother me that the payment remain the same, just means i can kick back a little earlier when its paid off

i will phone IF in the morning and find out the details

thanks again
matt

matt987106

oh and yes, out loan value is good, its under 60 K on a near 200 K house

Caladan

You could re-mortgage at 2.6% or less, if you can get through the under-writers

dimbo61

As you are self employed I would keep upto £16,000 in savings and pay the rest off the mortgage or maybe split the rest in two and pay half off the mortgage and treat the family to a holiday in france staying near Disney land Paris ( good campsites nearby or static caravan ) and visit Disney and PARIS.
Make sure that £16K is the MAX savings as more than this would stop you getting benefits.

matt987106

dimbo61 wrote: »

As you are self employed I would keep upto £16,000 in savings and pay the rest off the mortgage or maybe split the rest in two and pay half off the mortgage and treat the family to a holiday in france staying near Disney land Paris ( good campsites nearby or static caravan ) and visit Disney and PARIS.
Make sure that £16K is the MAX savings as more than this would stop you getting benefits.

we go to Orlando Disney every year, so while a trip to DLP and paris would be nice, we prefer the real Disney

cheers
matt

dimbo61

Been to both myself and found florida a bit hot for me.
Still think the £16K max savings is a good Idea and overpay the mortgage with any spare after that

matt987106

Just for the record, that 25 - 30 now looks like 41 K

looks a little better