Overpayment mortgage advice

Halude

Hi all,
I have been reading the forums alot recently on tips and tricks to try and make my first house buying experience a memorable one in a good way,

i am aiming to obtain a 25 year mortgage, however i want to pay it off way before the 25 years,

however i have noticed that the mortgage providers like to sting you by capping the amount of overpayments you can repay,

has anyone had any good dealings regarding overpayments and is there a provider that allows you to pay more than 20% of your monthly payments per month.

if anyone has a guiding light i would be very greatful for any advice and guidance you have to offer.

Cheers
Stu

Thrugelmir

If the mortgage is comfortably affordable shorten the mortgage term at the outset by a year or two. There's no requirement to apply for 25 years.

dimbo61

Even fixed rate mortgage usually allow 10% overpayments each year !!!
Now that is 10% of the outstanding balance
Many trackers and offset deals allow unlimited overpayments or offsetting.
You need to read carefully the mortgage offer paperwork or ask questions of the mortgage provider
We reduced our mortgage term from 22 to 10 years and will save £50,000 in interest payments BUT this means we have to pay an extra £500 a month every single month for the 10 years

dimbo61

PS we have an offset mortgage

rd07

Our previous fix allowed 10% of the outstanding balance, but you could only pay this once a year (January) in a lump sum.

New mortgage we have applied for allows unlimited overpayments, no restrictions on timing and no penalties unless you repay the mortgage in full during the fix.

kingstreet

You often find there is a trade-off.

The best rate/terms will have the weakest overpayment options, while the better overpayment option may not have very good rates.

There are both available in the market. You simply have to find the right combination for you, or be prepared to compromise somewhere on the cost or the amount you can overpay.

Halude

thanks for all your advice, i will be seeing a mortgage broker a week on saturday and i will be discussing all avenues,

i will look into shortening the repayment time, but i would like to aim for maximising repayments,

i have worked out i can repay around £500 per month, i dont want to go over the top with expensive house's, i have found a nice 80k house,

i will be putting down a 10% deposit, hopefully by the time it comes to it, i should have 15%

im a firm believer of getting the morgage repaid as fast as possible, while still maintaining a resonable social life,

Gizmo247

Get an offset mortgage but run it like a repayment. Tricky to do these day but if you have an existing repayment vehicle - not impossible. The benefit is - 100% over-payment and no early repayment charge.